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Saturday, July 24, 2021

US jobless claims rise to 419,000 from pandemic low

WASHINGTON — The number of Americans seeking unemployment benefits rose last week from the lowest point in the pandemic, even as the job market appears to be rebounding on the strength of the economy reopening.

Jobless claims rose to 419,000 last week, the Labor Department said Thursday, the most in two months from 368,000 last week. The number of first-time applications, which typically track layoffs, has been falling steadily since topping 900,000 in early January.

Economists described last week’s growth as most likely due to some one-time factors and partly the result of an inevitable jump in week-on-week figures. Applications for unemployment aid sprung up last week, for example, in Michigan, where GM has announced it is ceasing truck production due to a lack of supplies.

“I am not concerned that this reading indicates a sudden weakening in labor demand,” said Stephen Stanley, an economist at Amherst Pierpont Securities. “In fact, I’m pretty sure it isn’t.”

Americans are shopping, traveling and eating out as the pandemic eases, boosting the economy and forcing businesses to scramble for more workers. Companies posted the highest number of jobs available in the two decades the data tracked. Hiring has boomed, though businesses say they often don’t get enough employees at the salary they’re willing to pay.

At the same time, analysts are becoming concerned about the potential economic consequences of a tick-up in confirmed viral infections as the highly contagious delta variant spreads, especially among non-vaccinated people. The seven-day rolling US average for daily new cases rose to more than 37,000 in the past two weeks as of Tuesday, down 13,700, according to data from Johns Hopkins University.

Complaints by companies that they are not getting enough workers have prompted 22 states to prematurely end $300-a-week federal unemployment benefits, which comes on top of state jobless aid. Twenty states have ended their participation in two other federal programs—one that provides benefits to the self-employed and gig workers and another that serves people who have been out of work for six months or more. .

Officials in two other states, Indiana and Maryland, had sought to end supplemental assistance programs, but were stopped by court decisions. Nationally, all programs will end in early September.

The early cut-off of expanded unemployment aid has contributed to a steady decline in the number of people receiving unemployment benefits. That number fell to 12.6 million for the week ending July 3, the latest period for which data is available, down from the previous week’s 13.8 million. More than 600,000 unemployment aid recipients were cut off in Texas alone.

The long-term decline in applications for jobless aid coincides with a boom in economic growth. The US economy is believed to have expanded rapidly during the April-June quarter, as Americans ramped up their spending with stimulus checks and cash from the stock market and home equities.

Shopping at retail stores and restaurants rose in June, the government said last week. Retail sales are up about 20% above pre-pandemic levels.

Nation World News Deskhttps://nationworldnews.com
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