The next round of unemployment insurance claims could spike to an unprecedented 2.25 million, according to an analysis from Goldman Sachs.
Analyst David Choi put the number of claims for the week ending March 21 at 2.25 million based on seasonal adjustments. His most conservative estimate for the figures was 1 million, which would far exceed the record set in 1982 of 695,000 weekly claims.
Choi offered his estimate based on press reports and anecdotal evidence.
Data released by the government on Thursday showed weekly claims spiking by 70,000 for the second week of March, bringing the total number of unemployment claims for the week to 281,000. That figure was already the highest in 2.5 years, but just an eighth of Choi’s prediction.
Social distancing steps taken by governments have suspended sports leagues and shuttered gyms, bars, restaurants and theaters, leading to fears that a recession is inevitable.
A daily consumer confidence tracker from Morning Consult dropped over 12 percent to the lowest point since the company started tracking over two years ago. Last week, 26 percent of consumers expected business to deteriorate over the course of the year. This week, the figure jumped to 38 percent.
The Goldman Sachs analysis anticipated that casinos would lose 95 percent of revenue, sports and entertainment would lose 80 percent, hotel revenue would drop 75 percent, public transport would plummet 70 percent and restaurants would see their income drop 65 percent.
In Washington, Congress and the Trump administration are scrambling to roll out policies that would help businesses keep employees on the books through the crisis and provide a cushion to those who lose their jobs.
Senate Majority Leader Mitch McConnell (R-Ky.) unveiled a bill Thursday that would make bridge loans available to struggling businesses and provide Americans with stimulus checks of up to $1,200.