The number of workers in the U.S. applying for first-time jobless benefits held at historically high levels last week as the labor market continues to see-saw amid the coronavirus pandemic and its back-and-forth effect on companies' need for workers.
The Labor Department reported Thursday that 870,000 Americans filed for first-time jobless benefits for the week ended Sept. 19, up from a revised 860,000 claims the week earlier. Economists polled by FactSet had been expecting claims of 850,000.
The number marks the fourth consecutive week of claims below 1 million 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.
Continuing claims, which are the number of people not just filing for the first time but staying on unemployment benefits, came in at 12.58 million for the week ended Sept. 12, revised downward from 12.747 the previous week, the Labor Department said.
Jobless claims have fallen significantly from a peak of near 7 million in late March but have stagnated at just over 800,000 in recent weeks - roughly four times the levels recorded by the Labor Department before the virus rolled across the U.S., bringing the economy to a standstill.
"While jobless claims under a million for four straight weeks could be considered a positive, we’re staring down a pretty stagnant labor market," said Mike Loewengart, Managing Director, Investment Strategy with E*TRADE Financial. "This has been a slow roll to recovery and with no signs of additional stimulus from Washington, jobless Americans will likely continue to exist in limbo."
Indeed, while the economy has regained approximately half of the jobs lost in the pandemic, hiring has slowed in recent months as resurgences of the virus have percolated throughout the country, and as firms and businesses pause and assess their staffing needs amid the economy's stimulus-fueled, boomerang rebound.
The pre-pandemic record for weekly claims was 671,000 in September 1982.
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 last 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.
Some 11,511 individuals claimed Pandemic Unemployment Assistance benefits last week, while 1.632 million claimed Pandemic Emergency Unemployment Compensation benefits, the Labor Department said.
The biggest increases in initial claims for the week ending Sept. 12 were in Indiana (+1,990), Kansas (+1,928), Illinois (+1,906), and Michigan (+1,727), while the largest drops were in California (-17,400), Texas (-15,905), Louisiana (-8,384), Georgia (-8,235), and Washington (-3,291).