The explosion of new cases of COVID-19 in the south and west of the United States is a threat to the economic recovery and has forced several States to close bars and restaurants, but the effect on employment remains uncertain and the jobless claims were down last week.
Thus, 1.314 million people who pointed to unemployment last week, down compared to 1,413 million the previous week, according to data released Thursday by the department of labor.
Analysts were expecting a number a little higher, and projected 1.35 million new claims for benefits.
“The job market is recovering, but the impacts of the resurgence of the virus could slow down this progression,” says economist Joel Naroff in a note.
Florida, Texas, California, Arizona, Louisiana, Tennessee,… For about a month, the number of cases of COVID-19 and hospital admissions rises in the south and west of the country.
Several States have had to suspend their process of déconfinement, or even go back by ordering the closure of bars and restaurants in particular.
President Donald Trump, who bet on a recovery of the economy to be re-elected to the White House in November, scans regularly, this resurgence, due simply to an increase of the capacity test during the month of June. A hypothesis refuted by the experts.
Last week, he was delighted at the announcement of a decline in the unemployment rate to 11.1% in June compared with 13.3% in may, and the creation of 4.8 million jobs over the month.
He had promised ” a superb third quarter “, ignoring the return of the COVID-19, that threatens yet the economic recovery in the country.
18 million unemployed
“We certainly have hot spots. We will address these hot spots. People are starting to learn to work in this environment, some businesses have bounced back very effectively, as some companies will take longer, ” commented the secretary of the Treasury Steven Mnuchin, who was interviewed Thursday on channel CNBC.
“The restaurants, the hotels, the airlines will clearly be areas where there will be need of more help” financial to the federal government, he added.
In total, 18 million people were in the unemployment in the country at the end of the month of June.
It is certainly in decline compared to the previous week but at a level that is always particularly high: last year at the same period, 1.7 million Americans receiving unemployment allowance.
Risk of a break in progress
The number of indemnified persons “is nearly three times (higher) than the peak of the Great Recession” of 2009, are in a note analysts at Oxford Economics.
According to them, ” a full recovery of the labour market will take several years “, and they fear them also ” that the resurgence of infections COVID-19 increases the risk of a break in progress “.
On Wednesday, Donald Trump has also urged the country’s schools to reopen in the fall. In the United States, schools and universities are state and local authorities, and not the federal government.
The president of the federal Reserve bank of St. Louis, James Bullard, had been estimated Wednesday on CNBC that the use of the mask and the adjustments made by the companies –the takeaway being used by restaurants, for example– could allow the economy to start gently, and without waiting for a vaccine to be available.
“This does not depend on a particular vaccine or a therapeutic treatment, we may use a technology simple and easy as we have today, obtain a good situation, bring back the major part of the production to the normal,” he said, anticipating the possibility of unemployment down to 7% or 8% by the end of the year.