Indiana, like the nation, has seen a surge in unemployment claims as the coronavirus pandemic begins to take its toll on the economy.
The U.S. Department of Labor report released Thursday shows non-seasonally adjusted claims ending March 21 soared to 61,635 in Indiana, up from 2,596 filed the week prior.
In Illinois, unemployment claims jumped to 114,663 on March 21, up from 10,870 the week prior. Kentucky went to 48,847, from 2,785 the week prior, while Michigan hit 129,298, up from 5,338.
“The picture is obviously pretty grim,” said Robert Guell, professor of economics at Indiana State University. “It is certain we are headed for a recession and the worst second quarter in post-World War II history.”
And unemployment claims are likely to surge again next week, Guell said.
That’s because restaurants, bars and nightclubs statewide were closed to in-person dining on March 16 under an order from Gov. Eric Holcomb, just five days before the end of the unemployment claims weekly report.
“This report was as of last week, when Indiana had not really shut everything down, which means that only a portion” of people had filed for unemployment, Guell said. “This [unemployment claims] number will be dwarfed by the next number” next week, he said.
Extending that to joblessness figures, Guell said the nation’s unemployment rate peaked at about 10 percent during the Great Recession, from late 2007 through mid-summer 2009, and was nearly 11 percent in 1982.
“But, even during the Great Recession, people went out to eat. So chances are really good that unemployment will be much higher. We have basically unemployed every server” in the state, Guell said, and in at least 24 states nationwide.
Still more Hoosiers may file unemployment claims after Gov. Holcomb on March 23 issued an order requiring Hoosiers stay at home from 11:59 p.m. on March 24 through at least April 7. It shut down governmental offices, businesses and nonessential travel amid the coronavirus pandemic. Seventeen people have died in Indiana with 645 positive cases of COVID-19 as of Thursday afternoon, according to the Indiana State Department of Health.
The governor limited public gatherings to 10 people, in line with federal guidelines, but Hoosiers can go outside to walk, run, bike or visit parks and recreation areas so long as they follow a social distancing guideline to remain 6 feet apart, and can travel to grocery stores, pharmacies, medical clinics and hospitals.
Hoosiers in businesses deemed essential can also continue to go to work. However, all public schools in the state are closed until May 1 and universities and college campuses statewide are closed to students, who must finish the rest of the semester via online classes.
The sudden halt in economic activity is the result of efforts across the state and nation to slow the spread of the virus so it won’t overwhelm the health care system and infect increasingly more people.
Nationwide, there were more than 3.28 million seasonally adjusted unemployment claims as of March 21, an increase of more than 3 million from the previous week’s revised level. That is nearly five times a previous record set in October 1982.
The Department of Labor stated the increase in initial claims is due to the impacts of the COVID-19 virus.
“Nearly every state providing comments cited the COVID-19 virus impacts,” the report stated. “States continued to cite services industries broadly, particularly accommodation and food services. Additional industries heavily cited for the increases included the health care and social assistance, arts, entertainment and recreation, transportation and warehousing, and manufacturing industries.”