Expert Pitch

Record jobless claims may push unemployment rate up to 6%

Cornell University
27-Mar-2020 2:55 PM EDT, by Cornell University

Data released Thursday morning showed how the COVID-19 pandemic is severely damaging the U.S. economy and its labor markets. According to the Labor Department, nearly 3.3 million people filed for unemployment benefits last week.     

Erica Groshen is a senior extension faculty member at the Cornell University School of Industrial and Labor Relations. From 2013 to 2017, she served as the 14th Commissioner of the US Bureau of Labor Statistics. Groshen says that Thursday’s data foreshadows the largest one-month increase in unemployment to date. 


Groshen says: 

“The increase in initial claims is very large and translates into consequential impacts on headline labor market statistics that we won't see for another six weeks in the Employment Situation report because of the way that the statistics are constructed.  

“Simple arithmetic suggests that switching 3.1 million U.S. workers from employed to unemployed raises the U.S. unemployment rate from 3.5% to 5.4% (a 1.9 percentage point jump). The largest historical previous one-month increase in unemployment was a 1.3 percentage point jump in October 1949 that was reversed in the next month, presumably due to a large strike. 

“However, surely not all furloughed workers filed for unemployment insurance (UI). In recent years, typically only about 1/3 of the unemployed are receiving UI. If we assume that under these circumstances, 75% of furloughed workers filed (which may be too high), then the unemployment rate implied rises to 6.0%, with the addition of 4.1 million to the ranks of the unemployed. 

“Note, however, that a fair share of the furloughed workers could classify themselves as temporarily out of the labor force in order to care for family members. To the extent that happens, the impact on the unemployment rate will be muted. Thus, it makes sense to focus on the employment to population ratio (EPOP), which was at 61.1 in February. Switching 3.1 million workers out of unemployment lowers EPOP to 60.0 and switching 4.1 million lowers it to 59.6%. 

“For the payroll survey, a loss of 3-4 million jobs or more in one month would dwarf the previous all-time largest decrease in payroll jobs, -1.96 million in September 1945, at the end of World War II.”


For interviews contact:
Rebecca Valli
office: 607-255-6035
cell: 607-793-1025
[email protected]


Please find other experts at Cornell available to discuss the coronavirus crisis from a science  and public health perspectivefor its impact on the economy and in the ways the pandemic is changing our daily lives.


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