The numbers: Initial jobless claims fell slightly in the second week of July to a post-pandemic low of 1.30 million, but the decline reluctantly points to continued stress on the economy as the United States struggles to cope with the latest outbreak of coronavirus.
New claims for unemployment benefits, a rough indicator of layoffs, fell 10,000 to 1.30 million from 1.31 million the previous week, the Labor Department said Thursday. The figures are seasonally adjusted.
Economists surveyed by MarketWatch had forecast 1.24 million new claims in the seven days ending July 11. These figures reflect claims traditionally filed through state unemployment offices.
Some 928,488 new benefit claims were also filed through a temporary federal aid program, bringing the combined total for the week to 2.43 million unadjusted.
Read: Growing demand for federal unemployment benefits points to new fissures in the economy
The number of people receiving traditional unemployment benefits across the states, known as continuing claims, decreased by 422,000 to 17.34 million in the week ending July 4. That is the lowest level since mid-April, although whether it continues to fall given the latest fissures in the economy remains to be seen.
Some 30 million much older people were receiving benefits through eight state and federal assistance programs as of June 27, the most recent data available. That is slightly below the 32.4 million unadjusted in the prior week.
MarketWatch is reporting selected unemployment claim data using actual or unadjusted figures to give a clearer picture of unemployment. The seasonally adjusted estimates typically expected by Wall Street have partially inflated jobless claims during the pandemic and become less accurate.
Read:Unemployment claims indicate that 30 million are still unemployed. Is it really that bad?
What happened: New unemployment claims were the highest in Florida, Georgia, and California, states that have experienced new COVID-19 outbreaks. California shut down a large part of its economy again this week.
Big picture: The decline in new jobless claims has slowed to a drag in the past month. An economic rebound in May and June has lost momentum in July amid a new wave of coronavirus cases that has forced many states to reimpose partial blockades or pause plans to reopen.
The latest setback is expected to again leave more people without jobs and delay the return of others to their jobs, making it difficult for the economy to recover. Economists say Washington needs to extend emergency unemployment benefits and increase other aid to prevent the situation from worsening.
What are they saying? “The trend in initial jobless claims has now almost stopped falling,” said Ian Shepherdson, chief economist at Pantheon Macroeconomics. “Next week could easily see an increase, for the first time since March, following the continued gradual reintroduction of restrictions across the South and parts of the West.”
Market reaction: The Dow Jones Industrial Average DJIA,
and S&P 500 SPX,
fell on Thursday trades.
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