The numbers are fewer but Americans filing for jobless benefits on a weekly basis are still registering in the millions.
Some 2.98 million U.S. workers filed jobless claims last week, the Labor Department reported on Thursday, even as parts of the U.S. economy slowly began to reopen after more than two months of being shuttered amid the coronavirus pandemic.
Economists polled by FactSet had been expecting 2.5 million claims up to last Saturday, down from the previous week’s tally of 3.2 million. Continuing jobless claims rang in at 22.8 million, still the highest on record.
Over the past eight weeks 36.5 million Americans have filed for jobless benefits. An initial claim is a claim filed after a separation from an employer. a continued claim, also referred to as an insured unemployment claim, is a follow-up claim for continued benefits that is filed after experiencing a week of unemployment.
"There is a light, albeit very dim, at the end of the tunnel," said E*TRADE Financial Managing Director of Investment Strategy Mike Loewengart. "That said, we shouldn’t be too enthusiastic as continuing claims came in higher and there are major structural issues at hand: a decade’s worth of labor market prosperity evaporated in the blink of an eye."
Indeed, the numbers back up just how steep the economic fallout from the pandemic has been, particularly on American workers. Federal Reserve Chairman Jerome Powell reinforced that view on Wednesday, noting the pace and scope of the current downturn is “without precedent" and that recovery could take longer than expected.
Speaking as part of a webinar with the Peterson Institute for International Economics, Powell said noted despite the Fed’s efforts to backstop the economy, numbers showing 40% of U.S. households with less than $40,000 in annual income losing at least one job mean "significant downside risks" remain.
"The scope and speed of this downturn are without modern precedent, significantly worse than any recession since World War II. We are seeing a severe decline in economic activity and in employment, and already the job gains of the past decade have been erased," Powell said.
The U.S. Bureau of Labor Statistics reported last Friday that 20.5 million Americans lost their jobs in April, pushing the unemployment rate up to 14.7%, blowing past the previous record rate of 10.8% back in 1948 as employers from Wall Street to Main Street to the local mall cut positions and furloughed staff.
"If last week’s jobs report didn’t starkly paint a picture of the lasting effects the pandemic has had on low- and middle-income workers, Powell’s remarks yesterday certainly did," said E*TRADE Financial's Loewengart.