CHICAGO (NewsNation Now) — The number of Americans applying for unemployment benefits last week dipped to 900,000, still a historically high level that points to further job cuts in a raging pandemic.
The number of Americans receiving traditional unemployment benefits is now 5.05 million, a decrease of 127,000.
Consumers are hunkering down at home, leading to a weakening in demand. Retail sales have fallen for three straight months. Restrictions on restaurants, bars and some stores, along with a reluctance of most Americans to shop, travel and eat out, have led to sharp spending cutbacks. Revenue at restaurants and bars plunged 21% in 2020.
“Indeed, the notion of a winter of discontent has taken on new and more distressing meaning,” said Mark Hamrick, senior analyst at Bankrate. “But hope remains for the period later this year when the economy can begin reopening.”
Once vaccines become more widely distributed, economists expect growth to accelerate in the second half of the year as Americans unleash pent-up demand for travel, dining out and visiting movie theaters and concert halls. Such spending should, in theory, boost hiring and start to regain the nearly 10 million jobs lost to the pandemic.
President Biden unveiled a $1.9 trillion coronavirus plan that would provide $1,400 checks for most Americans, which, on top of the $600 checks already being distributed, would bring the total to $2,000 per adult.
“With the new occupant of the Oval Office and Democrats now also controlling Congress, addressing the tandem crises of the pandemic and recession has been among the first orders of business,” said Hamrick. “Indeed, President Biden is hitting hit the ground running with a flurry of executive orders and plans for new stimulus legislation while taking a more hands-on federal approach managing the pandemic response.
The new plan would also make available $400 a week in federal benefits for jobless Americans and extend a moratorium on evictions and foreclosures through September. Biden’s $1.9 trillion proposal will require congressional approval.
The Associated Press contributed to this report.
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