COVID-19 Rocks U.S. Economy; 10M Americans Lose Jobs In Two Weeks

A record ten million Americans lost their jobs in just two weeks because of the coronavirus shutdown, the government reported Thursday, as states struggle to keep up with demand for unemployment benefits in the deepest, most rapid shock to the U.S. economy in history.

More than 6.6 million people filed claims for unemployment checks last week alone, the Labor Department said, doubling the previous record of 3.3 million set only a week earlier.

Some economists predicted that the unemployment rate, which was near a record low of 3.5% in February, could spike to 15% by the end of this month.

"I know what they're going through. It's horrible," President Trump said. "When this is over, it's going to be a day to celebrate, because everyone's going to go to work."

More than half of all households are reporting lost income since the pandemic hit the U.S., closing restaurants and retail outlets, shuttering factories and placing nearly 90% of the population under stay-at-home orders.

Ominously for President Trump, some of the hardest-hit states also happen to be battlegrounds in the 2020 presidential campaign. Pennsylvania had 362,000 new unemployment claims last week, or a rate of 62 claims per 1,000 workers; Michigan's rate was 63 claims per 1,000, double the previous week.

Mr. Trump won both states narrowly in 2016. Democratic frontrunner Joseph R. Biden said Thursday that the president "is responsible for failing to prepare our nation" for the outbreak.

New York state's unemployment agency is so inundated with people seeking benefits that it is asking them to file claims on different days, depending on their last names. Monday is reserved for last names that start with A through F.

Help is on the way, depending on how quickly besieged state agencies can deliver it. Weekly jobless benefits that are $600 higher than the typical unemployment check in each state will be funded by the $2.2 trillion economic rescue package that Mr. Trump signed into law last week. The benefits will last 39 weeks, instead of the usual 26.

"It has eased my mind so much," said Kathryn Lickteig, a out-of-work cook in Kansas City, Missouri, who signed up for unemployment compensation last week. "I do not have to actively go out and expose myself to the public and possibly get sick. I can stay home now and do my part in social distancing."

Treasury Secretary Steven T. Mnuchin promised Americans Thursday that direct payments of up to $1,200 per person will be issued within two weeks, also as part of the rescue package.

"It is a very large priority," Mr. Mnuchin said at the White House. "We want to get this money quickly into your hands."

People who have direct deposit capability with the IRS will receive the full payments if they have income of $75,000 or less, plus $500 per child. The payments are phased out at an income cap of $99,000.

The new law also makes jobless benefits available for the first time to part-time workers and the self-employed.

And on Friday, small businesses can start obtaining grants and loans totaling $350 billion through the Small Business Administration and private lenders, to keep their workers on the payroll for eight weeks and pay some of their overhead expenses.

Rep. Kevin Brady of Texas, top Republican on the House Ways and Means Committee, said the loans are part of $1.4 trillion in aid for businesses "to help them through this temporary cash-flow crisis."

"There is more harsh economic data coming our way," he said.

With $350 billion in emergency grants and loans going out to small businesses beginning Friday, House Democrats announced the creation of a special bipartisan oversight committee to prevent fraud and "political favoritism" by the administration in distributing the money.

"The panel will root out waste, fraud and abuse; it will protect against price-gauging, profiteering and political favoritism," Mrs. Pelosi, California Democrat, told reporters on a press call. "We need transparency and accountability."

Vice President Mike Pence said Thursday the coronavirus task force is working on a proposal to use some of a $100 billion-plus fund for hospitals to pay for coronavirus treatment for as many as 30 million uninsured Americans. The White House has decided not to reopen Obamacare exchanges to allow people without insurance to purchase health care coverage during the pandemic.

"The president will make a final decision tomorrow," Mr. Pence said.

With dire economic news pouring in from around the country, the stock market was a bright spot Thursday, with major indexes gaining about 2% on the strength of oil prices, which rose more than 20%.

The stock rally occurred when Mr. Trump announced that he expects Saudi Arabia and Russia to cut oil production, after he spoke with Saudi Arabian Crown Prince Mohammed bin Salman.

The Dow Jones Industrial Average rose 469 points, or 2.2%, to close at 21,413. The S&P 500 was up 2.2%, and the Nasdaq climbed 1.7%.

Mr. Trump said the Saudi crown prince had spoken to Russian President Vladimir Putin; the two countries have been waging an oil price war and refusing to cut production. The president also spoke with Mr. Putin this week.

"I expect & hope that they will be cutting back approximately 10 Million Barrels, and maybe substantially more which, if it happens, will be GREAT for the [domestic] oil & gas industry!" Mr. Trump tweeted.

The massive surge in unemployment claims raised the pressure on Congress and the White House to come up with a fourth rescue bill on top of what is already the biggest disaster aid plan in history.

House Speaker Nancy Pelosi reiterated her plans for a new measure that would include spending on infrastructure, although the House won't return to Washington until April 20 at the earliest.

Mrs. Pelosi told reporters that she already has her committee heads putting together a comprehensive "phase four" package that would funnel more money to state and local governments and shore up election security.

She said Democrats want to send more money to state and local governments to help them facilitate the new, expanded unemployment program because there are no uniform procedures nationwide.

"Should we again do the $600 [per week for unemployment]? I certainly think so," Mrs. Pelosi said. "So that the people have the purchasing power to help them meet their needs but also spend it — inject demand into the economy, help to be a stimulus, as well as relief."

Mrs. Pelosi said she has been in contact with Treasury Secretary Steven T. Mnuchin about a fourth package, and expects White House support on at least the infrastructure portion.

The president also is promoting the idea of a new $2 trillion infrastructure plan to create jobs this year. But House Minority Leader Kevin McCarthy of California said Thursday of a fourth rescue bill, "I don't think that's appropriate at this time."

"I'm for infrastructure in the future," Mr. McCarthy said. But he added that he wants to be sure it is "targeted, that it works."

House Republicans acknowledged that soaring unemployment is a reality Americans will have to face as the country works feverishly to contain the virus and stabilize the economy.

"I think we should all expect the jobs, the unemployment and the GDP numbers to feel brutal over the short term," Mr. Brady said. "This economy is taking a hit like we've not seen most long lifetimes, but it is the short term, we came into this most economically competitive and strongest economy."

But they stressed that it's also the very reason lawmakers need to focus on implementing the phase three package efficiently, rather than move forward with a fourth massive spending package.

"I think it's so critical, especially with these numbers, that we get this money out now and that's what our focus should be on," Mr. McCarthy said.

About half of all working Americans report some kind of income loss affecting themselves or a member of their household because of the coronavirus pandemic, with low-income Americans and those without college degrees especially likely to have lost a job, according to a new poll from the Associated Press-NORC Center for Public Affairs Research.

Sixty percent of Americans now say the national economy is "poor," an alarmingly swift reversal from the 67% who called it "good" in January.

The income losses include pay cuts, unpaid time off and reduced hours, as well as lost jobs, with 23% of adults who had work when the outbreak started saying they or a member of their household have since been laid off. A third of those in households making less than $50,000 a year say they or a household member have lost their job.

⦁ Valerie Richardson contributed to this article, which is based in part on wire-service reports.