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Pandemic-Driven Jobless Claims Nearing 50 Million

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The number of Americans filing for first-time unemployment benefits is broaching the 50-million mark, though the pace of claims continues to drop from a record near-7 million in late March.

Government figures released on Thursday showed that 1.314 million Americans filed jobless claims for the week ended July 3, down slightly from the revised 1.413 million claims for the week earlier, as U.S. employers continued efforts to reopen and rehire even as the coronavirus continued to flare up in various states and cities.

Continuing claims, which is the number of people not just filing but staying on unemployment benefits, came in at 18.062 million for the week ended June 27. The continuing claims numbers are reported with a one-week lag, but are considered a better gauge of the labor market.

Some signs of economic growth have emerged, including a June surge in hiring that took both Wall Street and Main Street by surprise. However, an uptick in new Covid-19 infections and hospitalizations in recent few weeks in states including Florida, Texas, Arizona and California continues to level doubt on whether businesses are opening too soon, in turn raising the specter that companies may continue to push off hiring plans.

"Amid a pandemic that continues to spread here in the U.S., we should take any seemingly positive jobs read with a massive grain of salt," said Mike Loewengart, Managing Director, Investment Strategy with E*TRADE Financial.

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