About 1.9 million people filed for unemployment benefits last week, which is another sign the economy is picking up as businesses reopen.

We have to remember the number does not include “people who filed for unemployment under a new program created by the CARES Act that extends benefits to gig and self-employed workers.”

The Wall Street Journal reported:

The number of people receiving unemployment benefits, or continuing claims, fell to 21.1 million in the week ended May 16. Another drop could suggest people are being rehired, said Michelle Meyer, chief economist at Bank of America.

“The labor market is healing. We’ve seen a slowdown in the rate of firing. We’ve seen a pickup in hiring,” said Ms. Meyer. “But there’s a lot more progress that needs to be done.”

This is the fewest claims since March 14.

However, economists believe it might “take years for the economy to fully regain the millions of jobs lost during the” Wuhan coronavirus pandemic.

The riots in response to George Floyd’s killing could cause the economy to slow down as well. With the destruction and looting some businesses have chosen to board up their shops and delay opening.

Payroll processor ADP and Moody’s Analytics reported that the private sector cut 2.8 million jobs in May:

“I think we’re going to see a slowing in the pace of job layoffs, but perhaps a longer period of consecutive monthly declines than we had originally anticipated,” said Constance Hunter, chief economist at KPMG LLP.

The ADP report showed the greatest number of job losses in May occurred at large companies with at least 1,000 employees. Private-sector employment declines in May were largest in manufacturing and trade and transportation, while leisure and hospitality, which was hard hit earlier in the crisis, fared better.

The Labor Department will release its May jobs report on Friday.

 

 
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