Virus Sends US Jobless Total To Record 14.7pc

The US economy lost a staggering 20.5 million jobs in April, the steepest plunge in payrolls since the Great Depression and the starkest sign yet of how the novel coronavirus pandemic is battering the world's biggest economy.

The Labour Department's closely watched monthly employment report on Friday also showed the unemployment rate surging to 14.7 per cent last month, shattering the post-second world war record of 10.8 per cent touched in November 1982.

It strengthened analysts' views of a slow recovery from the recession caused by lockdowns imposed by states and local governments in mid-March to curb the spread of Covid-19, the respiratory illness caused by the virus.

The economic crisis spells trouble for US President Donald Trump's bid for a second term in the White House in November's election.

After the Trump administration was criticised for its initial reaction to the pandemic, Trump is eager to reopen the economy, despite a continued rise in Covid-19 infections and dire projections of deaths.

"If there is a silver-lining in today's dismal jobs report, it is in the realisation that the economy cannot possibly get any worse than it is right now," said Chris Rupkey, chief economist at MUFG in New York. "Joblessness can only diminish from this point forward as many states start reopening."

Economists polled by Reuters had forecast non-farm payrolls diving by 22 million. Data for March was revised to show 870,000 jobs lost instead of 701,000 as previously reported. A record streak of job growth dating to October 2010 ended in March.

The jaw-dropping job losses in the last two months pushed non-farm employment to its lowest level since February 2011. Job losses were almost across the board, with leisure and hospitality industry payrolls plunging 7.7 million. Restaurants and bars accounted for nearly three-quarters of the decline.

Ironically, healthcare employment declined by 1.4 million jobs, with decreases at offices of dentists, doctors, other health practitioners and hospitals.

Though the unemployment rate jumped from 4.4 per cent in March, its ascent was blunted by the drop of 6.432 million from the labour force.

Some of the people who lost their jobs but are unable to look for work because of the coronavirus are not counted as unemployed. (Reuters)