A US jobs catastrophe for Donald Trump

Donald Trump has made repeated attacks on China over Covid-19
Donald Trump has made repeated attacks on China over Covid-19 Credit: MANDEL NGAN/AFP via Getty Images

The coronavirus jobs catastrophe in the US deepened on Thursday as another 3.2m axed workers filed for unemployment benefits, taking total clams in the past seven weeks to a staggering 33.5m.

President Donald Trump has labelled the virus as an attack “worse than Pearl Harbour” after almost 74,000 deaths in the US. Now the livid economic scars - and criticism over his handling of the outbreak - are set to threaten his bid for a second term in less than six months’ time. 

The brutal impact of the Covid-19 lockdown on the world’s biggest economy means that benefits are now being claimed by one in five Americans in work back in February, when the unemployment rate hit a 50-year low of just 3.5pc.

The level of claimants remains historically high although numbers have fallen steadily since the peak in late March, when a record 6.9m filed for relief in a single week. Only six of the 50 states in the US was hit by rising numbers in the latest data release.

But the true picture could be higher however as economists estimate that as many as 12m workers may not have filed for support as application systems became overwhelmed.

Nancy Vanden Houten, an economist with Oxford Economics, said: “While initial claims for unemployment benefits continue to recede slowly from their peaks, they remain at painfully high levels.” 

The figures also pave the way for what will be the worst month for the US jobs market since the Second World War as closely-watched non-farm payroll data are expected to show 21m job losses in April.

That would wipe out at a stroke all of the growth in US employment since the financial crisis and push the unemployment rate as high as 16pc - the most since the Great Depression.

The Trump administration has passed a $2.3 trillion package of support to aid the economy while the US Federal Reserve has also poured on massive monetary stimulus to prevent a total collapse of the world's largest economy.