Unemployment claims in the United States climb to 770,000 despite reopenings | Business and economic news

The number of Americans seeking unemployment benefits increased last week to 770,000 from 725,000 the week before.

The number of Americans claiming unemployment benefits rose to 770,000 last week, a sign that layoffs remain high even as much of the US economy steadily recovers from the recession triggered by the coronavirus pandemic.

Thursday’s report from the US Department of Labor showed jobless claims had risen from 725,000 the previous week. The numbers have fallen sharply since the bottom of the recession last spring, but still show employers in some industries continue to lay off workers. Before the pandemic struck, claims for unemployment assistance had never exceeded 700,000 in a week.

The four-week claims average, which flattens out weekly variations, fell to 746,000, the lowest since late November.

A total of 4.1 million people continue to receive traditional state unemployment benefits, down 18,000 from the previous week. Including separate federal programs to help workers displaced by the health crisis, 18.2 million Americans were receiving some form of unemployment assistance the week of February 27, down 1.9 million from the week previous.

The continued layoffs are occurring even as the labor market as a whole has shown solid improvement. Last month, U.S. employers added 379,000 robust jobs, the most since October and a sign the economy is strengthening as consumers spend more and states and cities relax trade restrictions.

With the acceleration of coronavirus vaccination, hope is growing that Americans will increasingly travel, shop, eat out and spend freely after a year of virus-induced contention.

President Joe Biden’s $ 1.9 trillion relief package is also expected to help accelerate growth, especially with most adults this week receiving $ 1,400 in stimulus checks, which is expected to fuel more spending. An extension of weekly unemployment benefits of $ 300 in early September will also provide support, along with money for vaccines and treatments, the reopening of schools, state and local governments and struggling industries ranging from airlines to concert halls.

“Tensions in the labor market persist, but we are planning deposits [for unemployment aid] to start declining with the lifting of restrictions and the resumption of normal operations, ”said Rubeela Farooqi, chief US economist at High Frequency Economics, in a research note. “As businesses regain their capacity, employment and income prospects will improve and, combined with tax support, will provide a powerful boost to the economy.

At the same time, the country is still short of around 9.5 million jobs compared to the number of jobs it had in February 2020. And Federal Reserve Chairman Jerome Powell suggested on Wednesday after the last Fed policy meeting that the overall economic outlook remained murky.

“The state of the economy two or three years from now is very uncertain,” Powell said at a press conference after the Fed announced that it plans to keep its key interest rate close to zero until it reaches zero. ‘in 2023 despite some solid economic gains and concerns about rising inflationary pressures. .

According to most barometers, business activity in the hard-hit large service sector of the economy is still far from normal. Data company Womply said, for example, that at the start of last week 63% of cinemas, galleries and other entertainment venues were closed. The same was true for 39% of bars, 32% of gymnasiums and other sports and leisure businesses and 30% of restaurants.

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *