US sees 1.54 million new jobless claims as virus layoffs go on

June 11, 2020: Layoffs caused by the coronavrius pandemic reached 44.2 million in the United States even as businesses try to reopen, with analysts warning of continuing damage to the world's largest economy.

Wall Street stocks plunged at the start of trading Thursday, reversing recent gains as traders became spooked by resurgent coronavirus cases in parts of the country and the new Labor Department data showing 1.54 million workers putting in new unemployment benefit claims last week.

Such massive layoffs have become routine since shutdowns to stop the coronavirus from spreading began in mid-March and have been declining since reaching their peak later that month.

But the weekly total is still well above any figure seen during the global financial crisis in 2008.

Rubeela Farooqi of High Frequency Economics said the data shows the US economy is clearly not back to normal.

"States and businesses have reopened, but activity remains restricted and subdued, which will likely result in ongoing layoffs over coming weeks," she said in an analysis.

COVID-19 remains a stubborn threat in the United States, which continues to record around 20,000 new cases every day with few signs of a reduction. States like Texas and North Carolina are seeing more patients hospitalized with the virus than a month ago.

AFP/APP