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Jobs Report Likely to End Hiring Streak04/03 06:09

   After a record 113 straight months of hiring, the government's monthly jobs 
report Friday is expected to show that the American jobs machine came to a 
sudden halt in March as a result of the coronavirus.

   WASHINGTON (AP) -- After a record 113 straight months of hiring, the 
government's monthly jobs report Friday is expected to show that the American 
jobs machine came to a sudden halt in March as a result of the coronavirus.

   Economists have forecast that the government will say employers shed about 
150,000 jobs and that the unemployment rate rose from a half-century low of 
3.5% to 3.9%, according to FactSet. But the jobs figure will vastly understate 
the magnitude of last month's losses because the government surveyed employers 
before the heaviest layoffs struck in the past two weeks. Nearly 10 million 
Americans have since applied for unemployment benefits, far more than for any 
corresponding period on record.

   Still, some job cuts likely happened earlier in the month, when most 
economists think businesses began clamping down on hiring. The job loss for 
March will underscore the head-snapping speed with which the economy has 
unraveled after nearly a decade in which employers added nearly 23 million 
jobs. As recently as February, employers added 273,000 jobs. 

   Economists had welcomed February's job gain, though they wondered why hourly 
paychecks weren't rising more quickly. But any concerns over sluggish wage 
growth have now been put well off to the side.

   "Four years of job gains have evaporated in the span of two weeks," said 
Daniel Zhao, an economist at the jobs website Glassdoor. 

   The layoffs will continue to mount. Some economists have forecast that 20 
million jobs will be lost by the end of April, swelling the unemployment rate 
as high as 15% and wiping out the bulk of the past decade's gains. That 
unemployment rate would be the worst since the 1930s.

   Roughly 90% of the U.S. population is living under some version of a 
shutdown order, which has forced the closure of bars, restaurants, movie 
theaters, factories, gyms and most other businesses. Some hotels are closed; 
others are largely empty. Fast-food chains are either closed or providing only 
drive-through service, costing thousands of jobs. 

   With business activity tightly restricted, analysts expect a 
stomach-churning recession. Economists at Goldman Sachs have forecast that the 
economy will shrink at an annual rate of 34% in the April-June quarter --- the 
worse fall on records dating to World War II. Goldman expects the economy to 
rebound with 19% growth in the third quarter. But even by the end of next year, 
the economy will not have fully recovered from the damage, Goldman projects. 

   Robert Kaplan, president of the Federal Reserve Bank of Dallas, said 
Thursday on CNBC that he expects the unemployment rate to rise to the mid-teens 
soon, before falling to about 8% by year's end. 

   A key determinant of the economy's future will be whether businesses can 
survive the shutdown and rehire many of the workers they laid off. If so, that 
would help the economy snap back and avoid the type of weak recovery that 
followed the past three downturns. 

   So far, some large and small businesses  are still paying for health care 
benefits and keeping in touch with their newly laid-off workers. But if the 
virus outbreak forces businesses to stay closed into the late summer, many may 
go bankrupt or won't have the money to rehire their old employees. 

   That would keep unemployment elevated, depriving potentially millions of 
people of a paycheck and slowing the recovery.


(KR)

 
 
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