About 1.9 million people filed for unemployment benefits last week, the Department of Labor announced Thursday, bringing the total for initial claims over the last 11 weeks to 42.6 million.
Continuing claims rose by 649,000 over the previous week, for a total of 21.5 million. Adding independent contractors, the number of people receiving unemployment benefits comes to roughly 30 million.
The good news: Initial jobless claims for state benefits continue to fall. Torsten Slok, chief economist at Deutsche Bank Securities, said the job market appears to have bottomed out and is “crawling out of the hole now,” adding that we “have the worst behind us.”
Earlier this week, Mark Zandi, chief economist at Moody’s Analytics, said he thinks the coronavirus recession is technically over, with growth resuming this month. “This Covid recession will go down as the shortest and arguably the most severe in history,” Zandi told The Washington Post.
The bad news: The unemployment numbers are still shockingly high, and the economy is in bad shape by any measure. “Even as states reopen, claims in the millions are an indicator that the economic pain of the Covid-19 crisis is still acute,” Daniel Zhao, senior economist at Glassdoor, told CNBC.
Recovery is expected to be slow and painful. Economist Ed Yardeni said Thursday in a note to clients that he expects it to take more than two years to recover all of the lost jobs, with a return to the February 2020 employment peak not coming until October 2022.
The even worse news: The official unemployment numbers are almost certainly underestimating the damage.
In addition to the state unemployment filings, there were about 623,000 newly reported claims from independent contractors, who are eligible to receive federal aid temporarily under the Pandemic Unemployment Assistance program. But at least half a million filings for pandemic relief payments have yet to show up in the official data, Bloomberg reported Thursday, due to lags in the system. And the weekly unemployment reports tell us nothing about the people who may still be working but are earning far less than they were just a few months ago.
Up next: On Friday the Labor Department will release its employment numbers for May. Economists surveyed by Dow Jones project 8.3 million job losses and an unemployment rate of 20.5%.