In a worrisome sign of the harm the virus is inflicting on the economy, the government said Thursday that the number of Americans seeking unemployment benefits jumped last week to 853,000 - the most since September.
In Tennessee, the number of initial jobless claims rose last week to 6,886, including 357 new claims in Hamilton County, as the number of newly unemployed persons rose to the highest in four weeks even as holiday hiring usually dampens unemployment.
Mark Hamrick, senior economic analyst for Bankrate, said it is unclear how much of the increase related to the volatility linked to the Thanksgiving holiday.
"But the underlying story and trends, including the slowing number of jobs being added in the monthly employment data, are unsettling," he said. "Our fears of a significant economic toll taken by the explosion in the COVID-19 cases have now been matched by a spike in new claims for unemployment benefits."
The surge in jobless claims made clear that many companies are still shedding workers as states reimpose business shutdowns and consumers avoid shopping, traveling or dining out.
Consumers thus far haven't spent as much this holiday shopping season as they have in previous years, according to credit and debit card data, and last month U.S. employers added jobs at the slowest pace since April. Restaurants, bars and retailers all cut jobs in November.
The coronavirus "is having an impact on consumers, it is having a big impact on the labor force, it is having an impact on businesses," said Gus Faucher, an economist at PNC Financial. "There are reasons to be concerned."
Last week, the number of Americans who applied for jobless benefits jumped from 716,000 in the previous week. Before the coronavirus paralyzed the economy in March, weekly jobless claims typically numbered only about 225,000.
The jump in jobless claims last week ranged broadly. New applications surged more than 47,000 in California, 31,000 in Illinois, 17,000 in New York and 13,000 in Georgia.
AnnElizabeth Konkel, an economist at the job listing website Indeed, said that increase was particularly concerning because it suggested that the December jobs report, to be released in early January, could show that the U.S. economy suffered a net loss of jobs in a month for the first time since April.
"Today's report is the first overt signal of a backward slide," Konkel said. "It's evident the labor market is still in crisis.
- Compiled by Dave Flessner