The numbers: New unemployment benefits fell to just over $ 1 million in late August, resuming a downward trend, perhaps signaling the resumption of a slow or painful recovery in the U.S. labor market.
Initial unemployment claims, a rough measure of redundancies, were rejected by 98,000 to 1 million in the seven days ended August 22, the Labor Department said Thursday.
Economists polled by MarketWatch had predicted 1 million new claims. This season’s adjusted figures reflect applications submitted the traditional way through statelessness offices.
New claims rose sharply last week after falling below the 1 million mark for the first time since the coronavirus epidemic in March. Most economists suspect problems with seasonal adjustments rather than other temporary factors.
The actual number of new claims suggests that this could be the case. They fell again to 821,591 and remained below 1 million for the fourth week in a row.
MarketWatch reports selected data on unemployment claims with actual (non-adjusted) figures to give a clearer picture of unemployment. The seasonally adjusted estimates typically expected by Wall Street have been distorted by the pandemic and at times seem to override new claims.
The number of people receiving traditional unemployment benefits across the states has meanwhile dropped with a seasonally adjusted 223,000 to another pandemic low of 14.54 million. It was the fourth straight decline.
These so-called ongoing claims are reported with a delay of one week and cover the seven days ending August 15th. The actual total was slightly lower at just under 14 million.
Once again, the direction of new claims seems to be predicted by Google searches on how to file for unemployment. Search was dropped last week.
To read:Google seeks out how ‘filing for unemployment’ is a crystal ball for unemployment claims
I: Has the past $ 600 federal unemployment benefit kept people from returning to work?
What happened: Total new claims last week rose slightly to unadjusted 1.43 million if self-employed workers are considered under a separate federal program. Just over 600,000 applied for federal benefits last week.
Altogether, an estimated 27.2 million people received benefits through eight state and federal aid programs as of August 8, the latest available data. That was down from unadjusted 28.06 million in the previous week.
The number of people applying for unemployment benefits has been steadily declining over the summer, but they are still very high by historical standards. Before the pandemic new claims ran into the low 200,000s and were close to a 50-year bottom.
The ongoing battle in the face of the coronavirus pandemic, what’s more, could cause layoffs in the fall if the economy does not accelerate. Earlier this week American Airlines AAL,
said it would lay off or remove 19,000 workers because so few people fly.
What is still unclear is the effect of the expiration of a $ 600 federal unemployment benefit at the end of July. President Trump has authorized temporary $ 300 federal payments, but most states are not yet offering the money and the extra cash is just starting to flow.
Large image: The economy seems to have a major summer outbreak of the coronavirus better than initially seemed. Retail, manufacturing and home sales are all growing faster and Americans are starting to weigh in again.
To read:US durable goods orders jump 11.2% in July on strong demand for cars and trucks
However, the virus still acts as a major brake on the economy and further progress is likely to be invalid, especially if unemployment remains at or near double digits.
To read: Americans worry that the economy will suffer for a long time, even if they spend
What are they saying? “The risk of permanent damage to the labor market remains high, which will slow down the pace of recovery. Returning to pre-pandemic levels of prosperity is seen as an uncertain and long-lasting process, ”said Rubeela Farooqi, chief economist at High Frequency Economics.
“Continued unemployment claims are slowly falling,” said PNC Financial Services chief economist Gus Faucher. “This indicates that some workers who lost their jobs during the pandemic will be re-hired or take new jobs, but that many others will remain unemployed. Unemployment in the US economy is slowly declining. ”
Brand Response: The Industrial Industrial DJIA of Dow Jones,
and S&P 500 SPX,
were set to open lower in trading on Thursday.
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