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BUSINESS Friday 11 december 2020
Across U.S. and Europe, pandemic's grip on economies tightens

By CHRISTOPHER RUGABER to data from Opportunity
AP Economics Writer Insights, a research center
WASHINGTON (AP) — The affiliated with Harvard and
worsening of the viral pan- Brown universities, spend-
demic across the United ing on debit and credit
States and Europe is threat- cards — a critical barome-
ening their economies and ter of growth — sank nearly
intensifying pressure on 12% in the week that end-
governments and central ed Nov. 29 compared with
banks on both continents a year earlier. That marked
to intervene aggressively. a sharp drop from the pre-
In a worrisome sign of the vious week, when such
harm the virus is inflicting spending was down just
in the U.S, the government 2.3% from 12 months earlier.
said Thursday that the And last week's jump in job-
number of Americans seek- less claims ranged broadly.
ing unemployment ben- New applications surged
efits jumped last week to more than 47,000 in Califor-
853,000 — the most since nia, 31,000 in Illinois, 17,000
September. The surge in in New York and 13,000 in
jobless claims made clear Georgia. Many states, par-
that many companies are ticularly California, have
still shedding workers as adopted sweeping new
states reimpose business restrictions on business ac-
shutdowns and consumers tivity. But even some states
avoid shopping, traveling that generally haven't
or dining out. The electronic screen at the Nasdaq MarketPlace displays the Airbnb co-founders Brian Chesky, imposed stricter rules on
Consumers thus far haven't top, Joe Gebbia, left, and Nathan Blecharczyk, right, Thursday, Dec. 10, 2020, in New York. businesses reported sharp
spent as much this holiday Associated Press increases in jobless claims
shopping season as they last week. In Texas, for ex-
have in previous years, ac- announce other moves, One disturbing sign in Thurs- July. And his current unem- ample, they jumped by
cording to credit and debit such as shifting more of its day's report on jobless ployment aid will expire in nearly 20,000 to 45,000.
card data, and last month purchases to longer-term claims was that the total just over two weeks if it isn't The worsening figures may
U.S. employers added jobs bonds to try to further cut number of people who are extended. partly reflect a rebound
at the slowest pace since long-term borrowing rates receiving state-provided McGraw, 26, lost his job as after applications for un-
April. Restaurants, bars and and encourage spending. unemployment aid rose for a cook at a Hilton Hotel in employment benefits had
retailers all cut jobs in No- But most analysts think the the first time in three months New Orleans, where he fallen during the Thanksgiv-
vember. Fed will keep that step in — from 5.5 million to 5.8 mil- lives, back in March just af- ing holiday week. Still, the
Responding to similar pres- reserve. lion. The increase indicated ter the virus erupted in the increase was much larger
sures, the European Cen- Last week, the number of that some companies have United States. He said he's than most economists had
tral Bank announced Thurs- Americans who applied pulled back on hiring. applied for 35 jobs without expected.
day that it will ramp up its for jobless benefits jumped AnnElizabeth Konkel, an any luck. His primary work All told, more than 19 million
bond-buying program to from 716,000 in the previous economist at the job listing experience is in restau- people are still dependent
try to hold down longer- week. Before the coronavi- website Indeed, said that rants, few of which are hir- on some type of unemploy-
term interest rates to spur rus paralyzed the economy increase was particularly ing. It will be even harder ment benefit. And unless
borrowing and spending. in March, weekly jobless concerning because it sug- to search for work without Congress acts soon, nearly
The ECB's action coincided claims typically numbered gested that the December a car. half of them will lose that
with the highest single-day only about 225,000. jobs report, to be released Most of the available jobs aid in just over two weeks.
viral death toll in Germany, The surge in laid-off people in early January, could he sees involve trucking That's when two jobless aid
Europe's largest economy, seeking aid could raise show that the U.S. econ- or work on offshore oil rigs, programs that the federal
and the shutdown of res- pressure on Congress and omy suffered a net loss of which require certifications government created in the
taurants, bars, gyms, movie the Trump administration to jobs in a month for the first he can't afford to obtain. spring are set to expire.
theaters and museums in agree on another financial time since April. McGraw has also worked The first program provides
France. aid package to bolster the "Today's report is the first with an advocacy group, unemployment benefits
The coronavirus "is having economy through what is overt signal of a backward Stand Up Louisiana, in sup- to the self-employed and
an impact on consumers, sure to be a financially slide," Konkel said. "It's evi- port of extending jobless contract workers, who
it is having a big impact on painful winter for millions. dent the labor market is still benefits. weren't eligible in the past.
the labor force, it is having A bipartisan group of sena- in crisis." "I didn't ask for this — no The second program is the
an impact on businesses," tors has proposed a $908 One of the jobless, Mon- one asked for this pandem- one that extends jobless
said Gus Faucher, an econ- billion package that would trell McGraw, said he just ic," he said. "I am trying to aid for 13 weeks.
omist at PNC Financial. extend two unemployment had to cancel his car insur- play the cards I am dealt With a coronavirus vac-
"There are reasons to be benefit programs that are ance and now can't drive with, and I have a really cine nearing approval,
concerned." set to expire Dec. 26 for because his unemploy- bad hand." many economists are op-
When the U.S. Federal Re- an additional four months. ment benefit of just $222 a He said he hopes that Con- timistic that the economy
serve meets next week, it Without such an extension, week isn't enough to keep gress will agree soon to ex- will rebound strongly next
may provide more detailed more than 9 million unem- up with the payments. He is tend jobless aid. year. But most warn that
guidance on how long it will ployed workers would lose also behind on his rent. "Maybe then I can get my another federal financial
continue its own bond-buy- benefits, making it even He managed to cover all car insurance back," he relief package is urgently
ing program, which could harder for them to pay his bills when the federal said. needed to support unem-
reassure markets that its bills, buy food and keep up government was providing Across the U.S. economy ployed workers, small busi-
purchases won't end any- with rent or mortgage pay- $600 a week in jobless aid. are widespread signs of nesses and state and local
time soon. The Fed could ments. But that program ended in sluggish growth. According governments until then.q