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First-time unemployment insurance claims continued to decline last week, hitting another pandemic-era low, a sign that the labor market is gradually improving.
The Labor Ministry reported Thursday that unemployment claims reached 709,000 for the week ended Nov. 7, up from 757,000 the week before. Economists polled by Dow Jones were looking for 740,000 new claims.
This marked the fourth week in a row that the total fell from the previous period, although claims remain above the pre-coronavirus pandemic record of 695,000 in 1982.
“In the near term, the stock market is monitoring labor market data through the lens of the stimulus outlook,” said Kenny Polcari, managing partner at Kace Capital Advisors. “Deteriorating employment data strengthens the case for more stimulus and vice versa. More stimulus is generally welcomed by investors.”
In addition to the drop in the weekly rate, outstanding claims again experienced a significant decline, falling to 6.79 million, a decrease of 436,000 from a week ago. Continuing claims run a week behind the title number.
However, the level of those who continue to receive remains high as thousands of workers who see their regular benefits expire migrate to the Unemployment Pandemic Assistance Program. Initial claims under the Unemployment Pandemic Assistance Program totaled 298,154 for the week, although it was actually a decrease of 63,805 from the previous week.
As of October 24, 21.16 million Americans were receiving some form of assistance, down from 374,179. A year ago, the total was 1.45 million.
Georgia had the largest drop in claims, with a drop of 14,127. Other significant declines came from Texas (-5,179), Kentucky (-4,979), New Jersey (-4,703) and of Florida (-3,497). Washington saw a jump of 10,381, while California increased by 5,162 and Massachusetts reported an increase of 2,799.
While unemployment remains a significant problem in the United States as the economy rebuilds after the coronavirus shutdown, the numbers are gradually improving.
Non-farm payrolls rose 638,000 in October, much better than Wall Street expectations. In total, around 12 million of the 22 million jobs lost in March and April have been recovered, with the unemployment rate falling to 6.9% from its peak of 14.7%. The unemployment rate was 3.5% before the pandemic declaration in March.
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