NEW YORK, Nov 26 (Reuters) — Americans on Thursday celebrated a Thanksgiving Day transformed by the coronavirus pandemic, with the traditional Macy's parade limited to a television-only event and many families resigned to meeting on video for turkey dinner.

Thanksgiving, normally a day for family and friends to gather in big numbers to feast on turkey and pumpkin pie and remember life's blessings, has been upended by the pandemic, with cases and deaths surging in recent weeks as cooler weather pushes people indoors where the virus spreads more easily.

The Macy's Thanksgiving Day Parade in New York, a spectacle of giant character balloons that has delighted children for nearly a century, was scaled back significantly. The route was reduced to one block, rather than 2.5 miles; balloon handlers were replaced by specially rigged vehicles; and spectators were prohibited from lining the streets as before.

The event concluded at noon after a three-hour procession of performances, floats and balloons, featuring stars like country music legend Dolly Parton and a four-story-tall "Boss Baby" from the popular film about a business-attired toddler -- all without the usual millions on hand to watch from the street.

The rainy weather did not deter people like Moriah Hargrave, a 36-year-old native of Lafayette, Louisiana, who got as close as she could to the action near Macy's flagship store in midtown Manhattan with the hopes of stealing a glimpse of Parton, or Brian Campbell of Rockaway, New Jersey, who described his fifth year of coming to the parade as "disappointing."

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"We didn't want to miss it because of 'rona season," said Campbell, 55, using a slang term for the novel coronavirus. "We wanted to see the parade, but this is what we are seeing, just the tail end of some turkey."

The holiday is being celebrated at a time of severe economic strain for millions of Americans. First-time claims for jobless benefits increased further last week, government data on Wednesday showed, suggesting that the recent explosion in COVID-19 infections and resulting business restrictions were undermining the labor market.

U.S. hospitalizations for COVID-19 reached a record of more than 89,000 on Wednesday, and experts warn that Thanksgiving could significantly boost a death toll that has exceeded 262,000 nationwide.

Despite advice from the Centers for Disease Control to stay home for the holiday, nearly 6 million Americans traveled by air from Friday to Wednesday, according to the U.S. Transportation Security Administration, although that is less than half the figure during the same period last year.

Many Americans have not seen their loved ones for months and see the annual get-together as important enough to outweigh the possible risks. Nearly 40% plan to attend a "risky gathering" during the holiday season, either in excess of 10 people or with people from outside their household, and a third will not require masks of their guests, according to a national survey by Ohio State University Wexner Medical Center.

Many others have canceled travel plans and will instead connect with loved ones over FaceTime or Zoom.

Margaret Bullard, a public defender in Atlanta, said she and her husband have taken every precaution since the onset of the pandemic, which came soon after the birth of her 9-month-old son. They drove from their home in Marietta, Georgia, to North Carolina to spend Thanksgiving with her in-laws, who have been equally fastidious in limiting potential exposure to COVID-19.

"As much as we would like to see some other family members, we know that we would be taking a much bigger risk by doing so," said Bullard, who is co-administrator of a Facebook group for "Covid-conscious" Georgians. "There will be plenty of opportunities for get-togethers in the future if we all do what we can to stay safe."

(Reporting by Andrew Kelly and Angela Moore in New York and Nathan Layne in Wilton, Connecticut; Editing by Richard Chang and Nick Zieminski)