US employers cut 700,000 jobs in March & that’s before Covid-19 turned really nasty

Payrolls in the US plunged by 701,000 in March, according to a US Labor Department report released on Friday. While the figures are much higher than forecast, economists say the worst is yet to come.

The unemployment rate rose to 4.4 percent, up from 3.5 percent in February. The decline in payrolls has become the first since September 2010.

Economists surveyed by Dow Jones earlier predicted that the payroll will be down at least 10,000, and also expected the unemployment rate to hit 3.7 percent. Meanwhile consensus forecasts put job losses at 100,000, while those expecting the worst said that we may see up to a one million drop. 

Though the data is meant to reflect the situation in the labor market in March, it was collected in the middle of last month, before the US was named the worst affected country by the number of coronavirus cases and before large businesses announced massive layoffs over the health crisis. 

The fact that in just two weeks nearly 10 million people applied for unemployment benefits in the US also indicates that March figures are not quite representative. So we should wait for April numbers to see the true scale of the disaster, some analysts warned.

“My sense is that when we get April data a month from now, we’ll see that the economy lost somewhere between 10 and 15 million jobs,” Mark Zandi, chief economist at Moody’s Analytics, earlier told CNBC.

As of Friday afternoon, the number infected by the deadly virus surpassed 245,000 in the US, while the number of total cases worldwide is more than one million.

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