Jobless Claims Hit Pandemic Low of 360,000. Is the Economy Making Progress?

Jobless Claims Hit Pandemic Low of 360,000. Is the Economy Making Progress?

There are more than 13.8 million Americans on some form of unemployment benefit as of June 26, major progress compared to the 30.6 million on some form of jobless aid during the same time last year.

 

First-time claims for unemployment benefits fell to a new pandemic-era low last week, according to data released Thursday by the Labor Department.

For the week ending July 10, seasonally adjusted initial claims for unemployment insurance totaled 360,000, a significant decrease from the previous week’s upwardly revised 386,000 and the lowest level of jobless claims since March 14, 2020.

 

Continuing claims dropped by 126,000 to roughly 3.24 million.

“We’re continuing to see and welcome further healing in the job market,” Mark Hamrick, senior economic analyst for Bankrate.com, said in a statement.

Another 96,362 Americans applied for relief under the Pandemic Unemployment Assistance (PUA) program, an initiative created under the Cares Act passed in March 2020 that sends jobless aid to gig workers, contractors and others who don’t normally qualify for traditional unemployment insurance. More than two dozen states have cut PUA in an effort to get more people into the labor market.

There are more than 13.8 million Americans on some form of unemployment benefit as of June 26, major progress compared to the 30.6 million on some form of jobless aid during the same time last year.

"Overall, there are still 13.8 million Americans receiving some form of unemployment assistance, down 372,000 from the previous week. That still elevated total will certainly be falling as the federal pandemic programs expire in September,” Hamrick said.

He added, “The current situation with the U.S. economy is truly remarkable. It features what will likely be the strongest annual growth in decades, but currently with a still heightened level of unemployment."

The report comes as the United States has reported its 6.8 million jobs down from February 2020, although the department released last week that there were a record 9.2 million job openings. But Federal Reserve officials have indicated that the labor market will slowly recover as the economy begins to return to normal.

“There clearly is a very, very high level of demand for people to come into these jobs, and for whatever reason people are taking a little bit of time to look maybe for a better job,” central bank chair Jerome Powell said during a House hearing Wednesday.

“We're kind of finding out as we go but I really do think, come back in six months, there'll be a whole lot of these people back to work and wages will have moved up a little bit,” Powell added.

Rachel Bucchino is a reporter at the National Interest. Her work has appeared in The Washington Post, U.S. News & World Report and The Hill.

Image: Reuters