AKIPRESS.COM - The European economy shrank by a record 3.8% in the first quarter as business activity from hotels and restaurants to construction and manufacturing was frozen by shutdowns aimed at preventing the spread of the coronavirus, AP reports.

The drop in the 19-country eurozone was the biggest since statistics began in 1995 and sharper than the plunge in the midst of the global financial crisis in the first quarter of 2009 after the bankruptcy of U.S. investment bank Lehman Brothers.

The drop compares to a 4.8% contraction in the U.S. during the first quarter as the shock from the outbreak hits economies around the world.

Unemployment rose only slightly, however, even amid the massive shutdowns that idled everything from florists to factories. The February jobless figure rose to 7.4% in March from 7.3% in February, statistics agency Eurostat said Thursday. Millions of workers are being supported by temporary short-hours programs under which governments pay most of their salaries in return for companies agreeing not to lay people off.

U.S. unemployment rose to 4.4% in March from 3.5% in February, though the eventual picture is likely far worse. First-time claims for unemployment benefits have skyrocketed in the U.S. as 26 million people applied through the first three weeks of April.