On the same day that president-elect Joseph R. Biden Jr. unveiled a sweeping $1.9 trillion aid package to combat the economic crisis brought about by the COVID-19 pandemic, the latest update on weekly jobless claims provided further proof of the need for further stimulus.
According to the Department of Labor, initial jobless claims climbed to 965,000 in the week ended January 9 on a seasonally adjusted basis, marking the highest level of new claims since August. For the past few months, the number of weekly claims had hovered around 800,000, never coming close to returning to pre-pandemic levels. After significant improvements in the labor market following the initial shock in March, the recovery has progressed slower than hoped in recent months, as businesses across the United States continue to lay off staff in the face of weak demand and continued restrictions.
The plan laid out by Biden on Thursday not only includes an extension of emergency unemployment programs through the end of September, but also a weekly unemployment insurance supplement of $400, similar to the $600 supplement that kept millions of workers afloat last spring. With 18.4 million people still receiving unemployment benefits at the end of 2020, the jobs crisis is far from over. Federal Reserve Chairman Jerome Powell had predicted a long road to recovery in July, when he said that it “could be well into the millions of people who don’t get to go back to their old job,” and that “it could be some years before we get back to those people finding jobs.” As it stands, it looks like he could be right.