Roughly 2.1 million filed initial unemployment claims in the week ending May 23, meaning millions have sought benefits for the 10th consecutive week, according to the U.S. Department of Labor.
The number of initial claims continues to fall each week, however. Last week’s total is down 323,000 from the week ending May 16, which saw 2.4 million file initial claims.
The largest increases in initial claims for the week ending May 16 were in California (31,764), Washington (29,288), New York (24,543), Florida (2,322), and Michigan (1,549).
In those 10 weeks, more than 40 million have filed claims. That’s close to 25 percent of the March labor force. In April, 20.5 million jobs were cut and the unemployment rate rose to 14.7 percent.
Next week, the Bureau of Labor Statistics will release a monthly report for May. White House economic advisor Kevin Hassett told CNN earlier this week that the unemployment rate for May could be more than 20 percent and reach even higher in June. During the Great Depression, unemployment reached a peak of nearly 25 percent in 1933. He also said it’s possible that unemployment could still be in the double digits in November.
Back in March—prior to the passage of the CARES Act—it was reported that Treasury Secretary Steve Mnuchin told senators behind closed doors that the unemployment rate could hit 20 percent without a stimulus package.
"I didn't in any way say I think we are going to have that," Mnuchin told CNBC at the time. "It's just a mathematical statement. … We're not going to let that happen. We're going to make sure that companies have money so they can continue to pay their employees.”
The legislation was passed in the final week of March, providing direct payments to hundreds of millions of Americans, enhanced benefits to the unemployed, and hundreds of billions in forgivable loans to small businesses. Despite the massive injection into the economy, Mnunchin’s estimate may come to fruition.
The stimulus package hasn’t come without its headaches. Operators in the industry are calling on the federal government to extend the loan forgiveness period in the Paycheck Protection Program from eight to 24 weeks and to delete the 75/25 mandate that requires employers to spend 75 percent of funds on payroll and 25 percent on rent/utilities.
In April, the food and beverage industry lost 5.5 million jobs after losing 500,000 in March. The National Restaurant Association said restaurants have lost nearly three times more jobs than any other industry since the pandemic began. There were 6.4 million workers on payroll in April, which was the lowest total since 1989, the Association said.
Although it’s a slow process, there are signs that restaurant jobs are beginning to return.
A majority of states have allowed restaurants to reopen dining rooms at a limited capacity, allowing brands to recall furloughed employees. For example, Chili’s has reopened more than 600 of its company-run dining rooms and brought back 40 percent of the 30,000 workers it furloughed. Companies like Outback parent Bloomin’ Brands and Olive Garden parent Darden Restaurants have also reopened hundreds of dining rooms in recent weeks.