New U.S. Unemployment Claims Accelerate Highest Since August

The pace of new unemployment claims in the United States accelerated to its highest level since August last week as the labor market continues to struggle amid a constant surge in coronavirus cases and deaths.

According to the Ministry of Labor on Thursday, the first seasonally adjusted application for unemployment assistance last week exceeded 784,000 last week. Economists predicted that 795,000 claims were filed last week.

The numbers showing the first increase in new bills in a month are after Washington approves a increase in federal aid and may reflect a catch-up two weeks after the holidays were shortened. ..

James Knightley, Chief International Economist at ING, said: “There will be no substantial improvement in the job market until Covid’s containment measures are eased and companies can hire with confidence. He said” low vaccination rates “may also prolong recovery. I warned that there was.

The US labor market has grown rapidly in recent months, with a surge in coronavirus cases and severely restricted corporate and social activities, resulting in the loss of 140,000 jobs in December. While deaths in the United States have remained at record highs, infectious diseases and hospitalization levels are rising in parts of the United States, such as California, the largest economy in the United States.

Continuing claims-the number of Americans actively collecting state unemployment benefits-were 5.3 million on January 2, compared to 5.1 million a week ago. Continued billing fell from 10.6 million at the end of September, but remains above the pre-pandemic level of about 1.7 million.

The insured’s unemployment rate, which is considered an alternative indicator of the unemployment rate, has risen from 3.5% to 3.7%.

New claims from the Federal Pandemic Unemployment Assistance Program increased from 161,159 on an unadjusted basis to 284,470 last week, providing benefits to self-employed people and others who are not eligible for regular benefits.

Brad McMillan, Chief Investment Officer of the Federal Financial Network, said: “Headlines can rock the market, but recently passed stimulus packages limit their economic impact.

“Overall, it’s another sign that the economy continues to face headwinds from a pandemic, but it doesn’t mean that a long-term recovery will be hindered,” he added.

US stocks remained strong on Thursday. The S & P 500 rose 0.3%, while the high-tech Nasdaq Composite index rose 0.5%.

Joe Biden, elected in the US presidential election, is expected to reveal details of his proposal for additional economic stimulus later Thursday. He signaled that the package would be bigger, saying, “It’s going to be trillions of dollars.”

Economists have partially cited a surge in new bills due to the passage of fiscal stimulus measures at the end of last year. This adds $ 300 a week to unemployment assistance. “Not all individuals eligible for unemployment benefits actually claim benefits, and additional payments add an incentive to apply for benefits,” said an Oxford Economics analyst.

“Last month, it was consistent with the rapidly increasing number of Covid-19 cases and the associated loss of hundreds of thousands of hospitality jobs,” said Robert Flick, a corporate economist at the Federal Navy Credit Union. It was.

The previous week, including Christmas and New Year, was taken into account in the data, Flick added, as some Americans may have been waiting to apply for unemployment until the end of their vacation.

Florida and Illinois are the largest contributors to the significant weekly growth, with submissions in these states more than double the previous week, based on pre-seasonally adjusted figures. Several other states have reported higher levels of billing, including California, Arizona, Kansas, Maryland, New Mexico, New Mexico, Texas, and Virginia.

The Federal Reserve Board said the increasing number of districts reported weaker employment levels over the last month. Employment still increased in the majority of regions, but recovery was slow and “remained incomplete,” according to a report from the Central Bank’s Beige Book released Wednesday.

Some employers said they were dealing with staff shortages and struggling to find suitable workers for entry-level and on-site positions. This is a challenge exacerbated by the proliferation of coronavirus infections.

President Esther George of the Kansas City Federal Reserve predicted a “snapback” of the U.S. economy once the Covid-19 vaccination was completed, but a significant delay in vaccine deployment would be one of the biggest risks to the outlook. I added that it would be one.

In all state and federal programs, a total of 18.4 million people were claiming benefits as of December 26, up from 19.2 million last week, according to unadjusted figures reported with a two-week delay. It has decreased.

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New U.S. Unemployment Claims Accelerate Highest Since August

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