Jobless Claims Remain High as Labor Market Continues to Retrench

Jobless claims are near 1 million for a second straight week as the post-holiday labor market continues to retrench amid a resurgence in the pandemic.
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Jobless claims were near 1 million for a second straight week last week as the post-holidays labor market continued to retrench amid a resurgence in pandemic-related infections and deaths.

The Labor Department reported Thursday that 900,000 Americans filed for first-time jobless benefits in the week ended Jan. 16 vs. a downward revised 926,000 claims the week earlier. Economists polled by FactSet had expected claims of 887,500.

Continuing claims, which are the number of people not just filing but staying on unemployment benefits, came in at 5.054 million for the week ended Jan. 9, down from the previous week's revised 5.181 million, the Labor Department said.

The numbers, the final set to be released under former President Donald Trump, reflect a post-holiday labor market that continues to struggle under the weight of an economy shredded by the coronavirus and still gasping for stimulus and support.

The report is also further reinforcement of what December's nonfarm payrolls report already illustrated in vivid detail: Tightened restrictions and stay-at-home orders in various parts of the country have been weighing on the labor market.

Despite the dismal weekly figures, economists and market-watchers are optimistic that things will turn around. Washington's recently approved stimulus package, which is hoped to spark another round of hirings, is widely expected to be augmented by another package put forward by President Joe Biden.

Separately, the U.S. Census Bureau reported Thursday that U.S. home builders started construction on homes at a seasonally-adjusted annual rate of 1.67 million in December, representing a 5.8% increase from the previous month.