Second wave of job losses threatens Trump’s re-election bid

Linda J. Dodson

Arizona is putting many restrictions back in place, closing bars, gyms and cinemas after becoming one of the country’s biggest Covid-19 hotbeds. Its jobless rate was at 9pc in May but unemployment benefit claims surged in June, early data suggest. 

Other swing states are also moving towards tighter restrictions, piling the pressure on jobs. North Carolina, Michigan and parts of Pennsylvania are delaying the next phase of reopening, and bars in Florida cannot serve alcohol in a bid to keep drinkers away in a bid to curb infection rates.

If laid-off workers vent their anger at the ballot box, Michigan and Florida look most vulnerable for Trump with unemployment rates in those states already at 21pc and 15pc respectively.

“If renewed containment measures across numerous states make it unviable for businesses to operate then it will only add to the problems in the jobs market,” warns James Knightley, ING economist.

He warns that unemployment benefits claims data are “remaining sticky” while data from Homebase – one of the few leading indicators that picked up the unexpected May number – suggest small businesses are “shedding jobs again”.

Recent history suggests Trump’s prospects for re-election are grim if the American worker is feeling the pinch. 

The last two incumbent presidents to be beaten in an election – George HW Bush in 1992 and Jimmy Carter in 1980 – both saw the jobless rate rise in the 12 months before their defeats. Meanwhile, Barack Obama, George W Bush, Bill Clinton and Ronald Reagan all won second terms with the jobless rate on the decline. 

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