Coronavirus economic updates: US cuts 701K jobs in March, unemployment rate jumps to 4.4%

The new jobs report show the first impacts of the outbreak on the labor market.

April 3, 2020, 4:18 PM

The coronavirus pandemic has quickly evolved from a health crisis to a financial one, shuttering businesses, upending entire industries and sending financial markets reeling.

Here's the latest news on how the COVID-19 crisis is affecting the economy. For more on financial resources available during the pandemic, click here.

Markets close out another volatile week

The Dow Jones Industrial Average fell more than 350 points Friday, or approximately 1.7%, to close out a volatile trading week.

The S&P 500 and Nasdaq both slipped about 1.5%.

The government jobs report released earlier in the day ended a streak of historically-low unemployment figures in the U.S., and officials warned that the economic impact of the COVID-19 outbreak would get worse.

"The trend of a declining unemployment rate that buoyed the U.S. economy for more than a decade is now sharply reversed," Moody's Investor Services senior vice president Robard Williams said in a statement Friday.

"Rising unemployment, combined with reductions in many employed workers’ hours and wages will severely constrain consumption, which is vital to U.S. economic growth and already plummeting due to restrictions to prevent coronavirus contagion," he added. "Provisions to support households and businesses in the recently passed CARES Act will mitigate the impact of rising unemployment on consumption to some extent, but GDP will nonetheless suffer a severe decline in the coming months.”

Disney to furlough employees 'whose jobs aren't necessary at this time'

Disney, which has previously committed to paying employees through April 18 despite its two parks in the U.S. being shuttered, said it will begin a furlough process on April 19 for "employees whose jobs aren't necessary at this time."

Eligible workers will continue to receive full health care benefits during the furlough period, the company said.

"Additionally, employees with available paid time off can elect to use some or all of it at the start of the furlough period and, once furloughed, they are eligible to receive an extra $600 per week in federal compensation through the $2 trillion economic stimulus bill, as well as state unemployment insurance," a spokesperson for The Walt Disney Company said.

Disney is the parent company of ABC News.

IMF chief calls crisis 'humanity's darkest hour'

The International Monetary Fund's managing director Kristalina Georgieva joined the World Health Organization's press briefing Friday, calling the economic impacts of the pandemic "a crisis like no other."

"Never in the history of the IMF have we witnessed the world economy coming to a standstill. We are now in a recession," Georgieva said. "It is way worse than the global financial crisis. And it is a crisis that requires all of us to come together."

"WHO is there to protect the health of people. The IMF is there to protect the health of the world economy. They both are under siege," she added. "I want to stress the message that you and I have sent to the world that saving lives and protecting livelihoods ought to go hand-in-hand. We cannot do one without the other."

She said the IMF is especially focused on protecting "hard-hit" emerging markets and developing economies around the world.

"They have, very often, less resources to protect themselves against these dual crises," she said. "We know that in many country health systems are weak."

The IMF has a $1 trillion emergency reserve that it is tapping into to provide emergency financing to countries, she added. Over 90 nations have already put in requests for funds.

Georgieva also called the crisis "humanity's darkest hour" and urged for multilateral cooperation to protect the most vulnerable around the world.

Under Armour to temporarily lay off US store employees

Sportswear brand Under Armour announced Friday it will temporary lay off all employees at its stores and outlets and approximately 600 people from its U.S.-based distribution centers, beginning April 12. The company said it will cover health benefits for eligible employees "for approximately two months during this temporary layoff period."

Moreover, Under Armour said it was extending its current store closures "until further notice."

Retailers like Macy's and The Gap have already announced similar measures as the pandemic buffets the retail industry.

Under Armour said that its board of directors and senior level staff with titles executive vice president and above will be taking a 25% compensation cut through the duration of the crisis.

"In these unprecedented and challenging times, the majority of stores where Under Armour is available remain closed, contributing to a significant decline in revenue," the brand's President and Chief Executive Officer Patrik Frisk said in a statement. "We do not take these decisions lightly and are doing all we can to minimize the impact on our teammates during this time. Because of the strength of our brand and the steps we have taken, we will weather this storm."

Top economic adviser to the White House says US economy is 'going to get worse'

Larry Kudlow, the president's top economic adviser, warned of the dire economic situation the country faces amid the coronavirus pandemic.

"It's going to get worse in the weeks ahead, there's no question about it," he told reporters Friday. "We have not seen the worst of it, I don’t want to sugarcoat it."

Kudlow also didn't mince words when asked on Fox News whether the country is looking at the potential of double-digit unemployment figures, saying, "They're going to look terrible in the weeks ahead. How much longer, I don't really want to forecast ... but there's no question that it will be bad."

His comments Friday marked a sharp reversal from the administration's tone just a few weeks ago.

On March 6, Kudlow said there was no need for "massive, federal throw money at people plans" and the administration was looking at "micro" economic stimulus actions.

On Friday, Kudlow said the government is focusing on the $2 trillion economic stimulus package, adding, "If we need to do more, we will do more."

Amazon CEO Jeff Bezos pledges $100 million donation to U.S. food banks

Amazon's CEO and founder Jeff Bezos announced he was donating $100 million to Feeding America, which would help restock food banks and food pantries in the time of economic uncertainty.

"Non-profit food banks and food pantries rely in large part on surplus food from a range of food businesses. For example, many restaurants donate excess food. But during this time of social distancing, restaurants are closed, and many other normal channels of excess food have also shut down," Bezos wrote in an Instagram post announcing the donation. "To make matters worse, as supply is dwindling, demand for food bank services is going up.⁣"

⁣Bezos currently tops Forbes' list of billionaires, with an estimated net worth of approximately $117 billion.

The donation comes just days after a group of Amazon employees at a warehouse in New York City walked off their jobs, demanding the company shut down and thoroughly clean the facility amid the COVID-19 outbreak.

US cuts 701K jobs in March amid coronavirus pandemic, unemployment rate at 4.4%

U.S. employers cut 701,000 jobs in March and the unemployment rate rose to 4.4% from 3.5%, according to the latest report from the Bureau of Labor Statistics.

The new report released Friday is the first to show the initial impacts of the novel coronavirus pandemic on the U.S. labor market.

The COVID-19 outbreak has brought U.S. businesses to a screeching halt. At least 45 states have issued or announced statewide closures of all non-essential businesses to help stop the spread of coronavirus in the U.S.

People queue to enter Payomatic, a business that offers check cashing, as unemployment claim figures were released, during the coronavirus disease (COVID-19) outbreak in Manhattan, New York City, April 2, 2020.
Andrew Kelly/Reuters

Some of the biggest job losses occurred in leisure and hospitality, especially in food and drinking services, according to the government. Notable losses also occurred in health care/social assistance, professional/ businesses services, retail and construction.

ABC News' Jordyn Phelps and Kirit Radia contributed to this report.

Related Topics