COVID-19 causes unemployment to soar

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Lauren Oligino, R3 News Editor

Due to COVID-19, the unemployment rate in the U.S. has reached its highest rate since the Great Depression. In a study released on April 15, the Brookings Institution estimated that the unemployment rate could already be above 15 percent, with nearly 17 million people filing for unemployment within the past 3 weeks. 

This comes after many nonessential businesses have been forced to close throughout the U.S. because of the pandemic. With the loss of revenue, many businesses are struggling to stay afloat and have had to lay off employees. According to marketplace.org, 1 in 10 people who were employed before coronavirus have lost their job. 

“I’m mostly worried about the economic and educational impact this will have on those who are already in difficult situations economically,” said senior Ava Feldman. “When it comes to healthcare, education, job opportunities, those in low-income communities are already greatly disadvantaged and this crisis is just widening that gap even more.”

Even when nonessential businesses are allowed to open again, many will have already gone under, taking numerous jobs with them. A survey of small businesses done by Main Street America found that approximately 7.5 million small businesses are at risk of closing permanently because of COVID-19. 

Kent Smetters, the faculty director of the Penn Wharton Budget Model, told marketplace.org that because of job losses, “Basically a third of income in the economy will fall in the second quarter — capital income and labor income.”  

Congress has attempted to combat COVID-19’s severe blow to the economy through its $2 trillion stimulus package. People who have become unemployed due to coronavirus will receive an extra $600 every week on top of their state’s unemployment benefits. The goal is for 100 percent of a person’s lost wages to be made up through the stimulus package and the unemployment benefits.