Unemployment claims: America’s first jobless claims once again rise above one million

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Economists were optimistic that the US job market would follow a steady path of recovery. But last week’s claims exceeded expectations after the previous week’s report was the first below 1 million since March, the Labor Department reported on Thursday.

Without seasonal adjustment, 891,510 people filed for regular benefits for the first time. On top of that, claims for the Pandemic Unemployment Assistance Program, which Congress introduced during the coronavirus pandemic, have also increased to 542,797. Adding these numbers together, unadjusted claims for the first time stood at 1.4 million last week.

This suggests that the recovery in employment has slowed this month. Because the survey for the Bureau of Labor Statistics August jobs report was also wrapped up last week, it could dampen economists’ forecasts for the jobs report early next month.

But the disappointment in the number of initial claims was offset by a larger-than-expected decline in continuing unemployment claims, which includes people who have filed regular claims for at least two consecutive weeks. That number fell to 14.8 million – still incredibly high but also to the lowest level since the first week of April.

Looking at the numbers, “it’s clear that what keeps people unemployed is not overly generous benefits, but a lack of job opportunities,” said Andrew Stettner, senior researcher at the Century Foundation, a think tank, in comments sent by email.

In total, nearly 28.1 million Americans claimed benefits under the various government programs available during the week ending August 1, about 200,000 fewer than the week before.

After months of shocking economic data, these awe-inspiring numbers no longer seem as shocking as they really are. But the road to recovery remains long and difficult.
The Federal Reserve said in its July meeting minutes on Wednesday that any rebound in the job market depends on reopening and businesses, which in turn depend on the trajectory of the virus and what we do. to contain it.
Follow these 10 steps to apply for and keep your unemployment benefits

Meanwhile, those claiming benefits no longer receive the weekly $ 600 boost Washington put in place under the CARES Act, which expired at the end of July. Instead, benefits are reduced to their normal amount, which is usually less than workers’ wages.

“Every day that goes by without an extension of supplementary unemployment benefits results in more and more suffering for tens of millions of families,” Stettner said.

As Congress has been unable to agree on a new stimulus deal so far, President Donald Trump has signed executive action to increase unemployment benefits by $ 300 per week by diverting money from Disaster Relief from the Federal Emergency Management Agency.

So far, only seven states – Iowa, Arizona, New Mexico, Louisiana, Utah, Colorado and Missouri – have requested federal funding to pay the additional benefits that Trump has signed on to.
But it may still take a while for that money to get into people’s wallets. States will have to create a new system for paying executive action benefits because the money comes from a different pot of money and is subject to different rules. And it could take weeks.
One way or another, states are struggling to foot the bill for the millions of jobless claims they have to pay and borrow from the treasury to make ends meet. California, New York and Texas remain the biggest borrowers.

– Katie Lobosco contributed to this story.

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