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1M apply for unemployment, as economy remains in limbo amid COVID-19 pandemic

Out-of-work Americans continued to seek assistance last week, as the economy remained in limbo amid spikes in coronavirus cases.

About 1 million filed initial claims for unemployment benefits, the Labor Department said Thursday.

That latest surge means just over 58 million have sought aid for the first time in just 23 weeks.

The claims, a rough gauge of layoffs, speak to the economic straits of millions of Americans who are struggling to buy groceries and stay in their homes.

According to the Mortgage Bankers Association’s most recent survey, an estimated 3.6 million homeowners are in forbearance, meaning their lenders have temporarily halted or reduced mortgage payments for borrowers struggling to pay.

The number of home loans that have received that short-term relief shrank slightly to 7.20% as of August 16, from 7.21% the week before , according to the MBA’s most recent survey.

“The share of loans in forbearance declined for the tenth week in a row, but the rate of improvement has slowed markedly,” Mike Fratantoni, MBA’s senior vice president and chief economist said in a statement. “The extremely high rate of initial claims for unemployment insurance and high level of unemployment remain a concern, and are indications of the challenges many households are facing.”

Additionally, he said, the pace of those coming out of forbearance slowed two weeks in a row.

Renters are in even greater trouble. Up to 15 million could face eviction, Oxford Economics said in a note, and protections that President Donald Trump has said he will offer through executive action are not spelled out.

“The eviction protections that Trump’s executive actions provide are vague, and even if the moratorium that expired on July 24 is extended, renters need direct financial assistance,” Oxford said.

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