U.S. Jobless Claims Remain at Elevated Level After Steady Declines - WSJ
By: Bryan Mena (WSJ)
S E E D E D C O N T E N T
U.S. jobless claims fell slightly to 385,000 last week, as worker filings for new unemployment benefits settled this summer at a level that is nearly double the pre-pandemic average.
The decrease in filings reported by the Labor Department on Thursday comes as the economic recovery faces risks from the Covid-19 surge driven by the Delta variant, supply-chain constraints and a shortage of available workers. The four-week moving average, which smooths out volatility in the weekly figures slightly decreased to 394,000.
Continuing claims for regular state programs, which provides an approximation of the number of people receiving benefits, dropped by 366,000 to 2.9 million in the week ended July 24, the most recent figures for that reading.
Claims have hovered between 368,000 and 424,000 since late May, elevated above pre-pandemic levels but significantly lower than early in the pandemic. The 2019 weekly average, ahead of the pandemic, was 218,000.
The trend, some economists say, could be happening while the labor market continues to recover from the pandemic and be part of a development where claims remain higher because of greater awareness of unemployment insurance programs.
“Many people before the pandemic just simply didn’t apply for unemployment insurance, even if they were eligible,” Daniel Zhao, senior economist at job-search site Glassdoor, said. “So we might see permanent higher levels of claims, even if the jobs recovery is continuing,”
Mr. Zhao said that while the totals for new jobless claims have started to level off, he thinks the labor market and broader economy continue to steadily recover despite risks from the Covid-19 surge driven by the Delta variant , supply-chain constraints and a shortage of available workers.
“There is a lot of potential for job growth in the coming months,” Mr. Zhao added.
The Labor Department will separately release the July employment report on Friday that will show whether hiring accelerated last month. Economists polled by the Journal estimate that 845,000 jobs were created last month, similar to June’s total, and that the unemployment rate fell to 5.7%.
Benjamin Widner, an economics professor at New Mexico State University, also expects job growth to continue, driven in part by industries that allow employees to work from home .
“IT technology, cybersecurity networks, all those types of remote-work jobs are going to be continuing to grow as we deal with the changing structure of the economy,” Mr. Widner said. He added that he also expects a slower decline in the number of weekly unemployment claims.
Many workers remain on the sidelines—the labor market in June was 6.5 million workers smaller than before the pandemic—and economists are watching to see if the surge in Delta variant cases affects the economy .
“What happens with Delta really depends on how people react to it. The virus itself is much worse in many ways, but at the same time, in previous surges there was no vaccine, and the only way people could avoid getting sick was if they disengaged from the economy completely,” said Ben Herzon, executive director of U.S. economics at IHS Markit. He added that the labor market’s recovery is vulnerable to the possibility of an even more lethal and contagious Covid-19 variant in the future.
Glassdoor’s Mr. Zhao said that the economic impact of the Delta variant will likely be limited compared with previous surges because of higher vaccinations and restrictions not being as severe as earlier in the pandemic.
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The coming months will be interesting.
Something doesn't ring true with this article Restaurants and businesses all over our county and city are cutting back hours because they simply can't get basic help. Help wanted signs everywhere. Dishwashers, cooks, greeters, receptionists, shelf stockers etc. I'm sure it's the same all over the country. I have never in my 60+ years seen anything like this as sustained as it has been.
Right now, the is almost an entirely Government created crisis and it will continue until they shut off the government gravy-train. Many people aren't looking for work simply because they don't have to. Uncle Sam is handling their bills right now so why should they?
As Joe Biden told the small business man who made that very complaint - maybe you should offer more money?
Sez the man who has never owned or run a business in his life.
Politicians acting like business experts always makes me puke.
All he ever knew was big government. Right now he is in mental decline, ran to defeat one man and made a deal with the devil that has left the country at the mercy of the radical left.
Seeing some shelf areas at the local Krogers (King Soopers) that are not stocked during the last few weeks. Don't know if that's for lack of stockers or problems in the supply chain.
Both probably ..... what wasn't being stocked?
The 99 cent store and the Dollar Store have both been well stocked.
I hear that in San Francisco the stock moves out as quick as it comes in.