Another 860,000 Americans filed for first-time unemployment benefits last week, a slight drop from the previous week’s level.
The Labor Department reported Thursday that 860,000 Americans filed for first-time jobless benefits for the week ended Sept. 12, down from a revised 884,00 claims the week earlier. Economists polled by FactSet had been expecting claims of 850,000.
Continuing claims, which are the number of people not just filing but staying on unemployment benefits, came in at 12.628 million for the week ended Sept. 5, down from a revised 13.544 million the previous week, the Labor Department said.
Some 14.467 individuals claimed Pandemic Unemployment Assistance benefits through August 29, while 1.527 million claimed Pandemic Emergency Unemployment Compensation benefits, the government said.
The number marks the third straight week of claims below the 1 million mark since the pandemic shut down the U.S. economy in late March. However, analysts noted this was mostly due to a change in the way the Labor Department makes its seasonal adjustments, which applied for the first time to the last jobless claims report for August.
Indeed, while weekly initial claims for jobless benefits have stabilized just below 900,000 in recent weeks, they still remain above the highest level before this year on record, which was 671,000 in September 1982.
And while the number of workers receiving unemployment payments has declined considerably from the record 6.9 million weekly claims filed in late March, it still suggests businesses and firms are holding back on re-hiring and filling new positions.
Economists and market-watchers note that businesses continue to struggle with what to do with furloughed and laid-off workers - even with government assistance helping them with pay day.
United Airlines (UAL) - Get Report has already announced thousands of permanent layoffs, while Ford (F) - Get Report, Boeing (BA) - Get Report, Coca-Cola (KO) - Get Report and others have said they plan to cut their payrolls.
Citigroup (C) - Get Report also announced this week that it will resume slashing its workforce, joining some of its rivals including Wells Fargo (WFC) - Get Report that are now reducing headcount in a bid to rein in costs ahead of what is anticipated to be a rising wave of business and personal loan losses.
That is in part reflected in the government's official employment tally, which as of last month showed that the economy is still out some 11.4 million jobs since March.
It's also very much on the Federal Reserve's radar. As part of its policy announcement on Wednesday, the Fed forecast unemployment will likely sit around 7.6% by the end of the year, better than its previous projection of 9.3% but still far off from what it considers "maximum employment" within the U.S. economy.
"The reality that the Fed is maintaining its accommodative posture for quite some time seems to be sinking in this morning," said Mike Loewengart, Managing Director, Investment Strategy with E*TRADE Financial. "Though a key indicator for the central bank is employment, and we’re seeing slight improvement on that front this morning, with stimulus talks firing up again, there’s no doubt unemployment will be closely watched by investors and the Fed in the weeks and months ahead."