MNI DATA PREVIEW: 4.5M US Claims Seen Taking COVID Loss to 27M

--New Weekly Claims Passing Peak, Continuing Claims Still Rising

By Brooke Migdon

     WASHINGTON (MNI) - U.S. weekly jobless claims are set to climb another

historic 4.5 million Thursday in what analysts call the beginning of a gradual

slowdown after a month of closures due to the coronavirus.

     The figure for the period through April 18 in the Bloomberg forecast is

smaller than the 5.24 million reported by the Labor Department last week, though

economists have often missed the scope of increases through the pandemic. The

consensus figure would fall short of the record 6.65 million claims filed

immediately after widespread shutdowns.

     Whatever millions of claims do come on Thursday will add to the 22 million

already tied to the COVID-19 shutdowns. Each report has shattered the previous

1982 record of around 675,000. Those claims are expected to drive unemployment

to at least 15% and rival the Great Depression, and why Congress and the Fed

launched massive stimulus to ensure the economy can recover when health orders

are eased.

     The Labor Department said last week the coronavirus continues to have a

significant impact on the number of initial jobless claims, and on continuing

claims -- unemployed workers who have received at least one week of benefits.

     Continuing claims surged last week to a record 12 million from the prior

week's 7.5 million. Analysts at Goldman Sachs see continuing claims rising to

17.3 million Thursday.

     --STATE ORDERS

     Nearly every state has issued stay-at-home orders or social distancing

guidelines to curb the virus' spread. Some have announced plans to reopen their

economies sooner than public health officials have advised, with businesses in

Georgia opening as soon as Friday. South Carolina partially reopened its economy

Monday. The level of jobless claims could potentially fall further as more

states roll back emergency measures and Americans go back to work.

     Layoffs are expected to increase in states that were slow to implement

stay-at-home orders and in others that are still working through backlogs, but

initial jobless claims should begin to level off in states that intervened

early.

     "Initial filings for unemployment benefits have been moderating over the

last two reports, suggesting that we are past the peak," analysts at Bank of

America, expecting 4 million initial claims on Thursday, wrote in a research

note.

--MNI Washington Bureau; +1 202 371 2121; email: brooke.migdon@marketnews.com

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