Weekly starting unemployment claims fell slightly to 1 million, to 1.1 million, according to data from the Department of Labor, as companies continue to employ workers, even as parts of the economy show signs of rebound.
Recovery remains well out of reach and depending on the health situation and policy response and the trendline remains volatile. Just two weeks ago, initial claims had dropped to below $ 1 million before re-emerging.
The current level of unemployment requirements of 1,006,000 is markedly below the spring peak of nearly 7 million, but still historically high. Before the coronavirus pandemic, the average number of requests was around 200,000 per week.
The report on unemployment attacks hit on the last day of the Republican National Convention, where President Donald Trump misleadingly stated: ‘We have just broken a record on jobs, a record of all time. There have never been three months where we have put more people to work, more than nine million people. ”
But the perspective changes when you expand the narrow window of time that Trump uses for the full picture. That return to work comes only after a loss of nearly 13 million jobs, the most in U.S. history.
Overall, the economy has lost nearly 6 million jobs since Trump took office, compared to an increase of more than 11 million in jobs over the same period during President Barack Obama’s last term.
“The economy is crawling out of the dark hole into which it has fallen, but it still has a long way to go,” said Mark Zandi, chief economist at Moody’s Analytics.
The new data on initial unemployment claims also comes as more than 30 states have been approved by FEMA to provide an additional $ 300 per week in federal benefits to workers authorized by President Donald Trump. This could motivate additional workers who were fired to file jobless claims, but only a handful of states have actually begun to split so far. Many states remain confused about the process and the need to reprogram what are often outdated computer systems.
Companies that are more vulnerable to coronavirus impact, such as travel, continue to announce layoffs, while even healthier companies are cutting costs to adjust for an expected decline and take advantage of the moment for restructuring.
This week, the aviation industry announced massive potential cuts if they are unable to expand more cost-cutting trade union concessions or receive additional federal aid. Legacy Airlines American announced 19,000 potential layoffs and Delta over 1,900. Bed Bath and Beyond said it would drop 2,800. Salfesforce.com, a day after announcing banner gains and seeing a share of action, said it would lay off 1,000 of its 54,000 members worldwide staff. Involved employees would have opportunities to apply for new roles in other parts of the company, the home goods retailer said.
The pandemic-driven recession is causing tectonic shifts in the U.S. corporate market and accelerating existing trends in many ways, exposing underlying weaknesses.
“If you have restructuring spread over several years in several months, it leaves no room for workers to move around. Normally, one sector emerges when another changes,” said Martha Gimbel, a labor economist at Schmidt Futures.
While in the spring there were predictions that the economic damage would be intense but short-lived, there are indications that, without an effective virus response, the recovery plateau is below pre-pandemic levels.
The percentage of unemployed workers on temporary dismissal has fallen, but those unemployed who were not mentioned as having been on temporary dismissal have risen, a sign that some of those temporary dismissals are becoming permanent.
“If we do not figure out what to do with people who are going to long-term unemployment, it will be a disaster,” Gimbel said. “
