US private sector sees jobless claims spiral over 20m
More than 20m US citizens were made redundant last month, a shocking jobless statistic showed today to underline the severe economic impact of coronavirus.
Payroll processing body ADP today reported private sector employment plunged by 20,236,000 jobs between March and April.
The jobless figures mean around 13 per cent of the 162m Americans employed in the private sector have lost their jobs during the country’s coronavirus lockdown.
Ahu Yildirmaz, co-head of the ADP Research Institute, said it was the worst jobless figures ever recorded by ADP.
“Job losses of this scale are unprecedented,” Yildirmaz said. “The total number of job losses for the month of April alone was more than double the total jobs lost during the Great Recession.”
Small US firms slashed cut 6m workers from their books, while medium businesses slashed over 5m jobs. The largest American firms got rid of almost 9m workers.
The ADP job report only captures job losses until 12 April, meaning redundancies could get a lot worse when the rest of April’s figures come next month.
Paul Ashworth, of Capital Economics, said the US jobless rate could shoot up to 15 per cent or worse on Friday.
That is when the US government will publish April’s non-farm payroll data.
He told the Guardian that today’s ADP data is not directly comparable with the non-farm payroll data. The former counts anybody in regular employment, while the latter includes anybody paid during the month.
“Within many people put on temporary layoff, that could have created a discrepancy,” he said. “Those people [are] still on the active payroll, but not counted in the official non-farm payroll figures and also qualifying as unemployed in the other official household survey.”
Fawad Razaqzada, a market analyst with Think Markets, said today’s ADP data showed the number of Americans left jobless was a “tad more than expected”.
“However, there was little reaction from the dollar, as the news was already priced in by the prior indications we had, for example, from the weekly jobless claims data,” he explained.
US stocks, then, still managed to post a slight rise to open marginally up. The Dow inched up 0.25 per cent while the S&P 500 rose 0.4 per cent. The tech-heavy Nasdaq posted the highest increase to rise above one per cent.