WASHINGTON (AP) — The number of Americans filing new claims for unemployment benefits surged last week by 70,000 to the highest level in more than two years, indicating that the effect of the coronavirus was starting to be felt in rising layoffs in the job market.

The Labor Department reported Thursday that applications for benefits, a good proxy for layoffs, rose by 70,000 to a seasonally adjusted 281,000 benefit applications last week. That was the highest weekly total since Sept. 2, 2017, following Hurricane Harvey.

Both the one-week rise and the total number of applications were far above the levels seen over the past year as the country's unemployment rate fell to a  half-century low of 3.5%.

Economists are predicting a surge in layoffs as efforts to contain the spreading coronavirus result in people losing jobs in a variety of industries from restaurants and bars to airlines and hotels.

"The more aggressive coronavirus containment measures imposed in recent days involving the near total shutdown of the retail, leisure and travel sectors in some parts of the country are clearly starting to have a dramatic impact," said Andrew Hunter, senior U.S. economist at Capital Economics.

He forecast that jobless benefit applications could easily exceed 1 million within the next few weeks, exceeding the weekly peak of 665,000 applications during the 2007-2009 Great Recession.

There have been a number of states such as Ohio reporting huge jumps in unemployment applications already. The Trump administration and Congress are scrambling to produce a support package of around $1 trillion which would provide checks to Americans who have been affected by the virus and support for small businesses and big companies such as the airlines.

A proposal from Treasury has suggested spending $500 billion to provide checks for Americans who have suffered economic harm because of the virus.

Treasury Secretary Steven Mnuchin said Thursday that the administration hopes to start sending checks out in the next three weeks, but the timing will depend on how quickly Congress passes a relief plan.

Economists are forecasting that economic growth will be negative in the upcoming April-June quarter and the third quarter, but Mnuchin said he was expecting growth to start to come back in the third quarter and be followed by a "gigantic" fourth quarter as the economy moves past the virus threat.

"We are going to get through this," Mnuchin said. "We are going to destroy this virus and our economy is going to come roaring back better than ever."a