What's going on?

There�s a new boss in town, and it�s wasting no time cleaning house: fresh US jobs data out Thursday showed the coronavirus is already forcing businesses to lay off American workers.

What does this mean?

Unemployment benefit claims climbed to 281,000 last week � a two-and-a-half-year high and an increase of 70,000 from the week before. Worst hit was Nevada, whose winning streak came to an end as its Las Vegas casinos shut down in the name of social distancing. Even so, this is likely only the tip of the unemployment iceberg, with data released next Thursday expected to show at least two million newly unemployed Americans.

Not to be a Debbie Downer, but Thursday�s other reports weren�t much better either: Philadelphia�s factory activity deteriorated by the most on record, while German business confidence plunged to the lowest level since 2009.

Why should I care?

For markets: Incubation period.
These releases were the first raindrops of what could well become a downpour of miserable economic data in the coming weeks � which won�t surprise anyone who�s been watching the financial headlines. Still, with US stocks down about 30% from their peak, markets seem to have pre-empted the negative data. So the question for investors isn�t really whether future economic releases will be poor, it�s whether they�ll be better or worse than feared. Next up: manufacturing activity and consumer sentiment surveys, released on Tuesday and Friday respectively.

The bigger picture: Temperature rising.�
Employment held up better than many had predicted throughout the 2008 financial crisis, when employees agreed to pay cuts or reduced hours to avoid layoffs. But job-saving compromises might be trickier to reach if the hardest-hit companies this time around end up failing entirely: a closed casino or shuttered store isn�t exactly going to keep employing people � pay cuts or otherwise � if there’s no business to speak of.