Jobless Claims Hit Record Highs Due to Coronavirus: Are More Layoffs Looming?
The coronavirus pandemic has disrupted the lives of nearly everyone across the globe. Employers have told millions of workers to stay home, in many cases in response to orders from state and local governments for nonessential businesses to close their doors temporarily. That's creating a flood of people being out of work and needing to take advantage of the programs available to the unemployed.
Every week, the Labor Department announces the number of people making claims for unemployment benefits for the first time since losing their jobs. Today's number of 3,283,000 initial unemployment claims was by far the largest ever for the program, and the sudden jump will inevitably put pressure on the unemployment benefits system to ensure that so many people get the money they need. Below, we'll look in more detail at exactly what today's jobless-claim numbers are and what they mean.
If you lose your job and are covered by unemployment insurance, then you have the right to collect unemployment benefits from the government. The insurance aspect of unemployment benefits stems from the fact that your employer has to pay taxes each pay period based on the amount of pay you receive, with the proceeds going toward covering benefits to out-of-work employees. When you combine what the federal government and the applicable state government charge, the typical amount of unemployment tax that employers pay is 6% of the first $7,000 in wages per employee, or $420 per year.
Source Fool.com
