Last week’s unemployment claims went up by 181,000 to 965,000, which is another sign the economy is having a tough time with COVID-19 spikes.
This is the biggest jump since August.
Continuing claims rose by 199,000 to 5.27 million.
From the Labor Department:
In the week ending January 9, the advance figure for seasonally adjusted initial claims was 965,000, an increase of 181,000 from the previous week’s revised level. The previous week’s level was revised down by 3,000 from 787,000 to 784,000. The 4-week moving average was 834,250, an increase of 18,250 from the previous week’s revised average. The previous week’s average was revised down by 2,750 from 818,750 to 816,000.The advance seasonally adjusted insured unemployment rate was 3.7 percent for the week ending January 2, an increase of 0.2 percentage point from the previous week’s unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending January 2 was 5,271,000, an increase of 199,000 from the previous week’s unrevised level of 5,072,000. The 4-week moving average was 5,215,750, a decrease of 59,000 from the previous week’s unrevised average of 5,274,750.
The numbers are not anywhere near what they were in March and April, but it’s still not good.
Jobs have been slowly created since May, but the winter months put an end to that due to more COVID-19 cases and states implementing more restrictions:
The report added to the evidence that the rapid rise in Covid-19 cases and fresh business restrictions in some places are weighing on the labor market. Employers cut 140,000 jobs in December, marking the first decline since the pandemic hit the country last spring. Leisure and hospitality workers bore the brunt of the decline, as a nationwide surge in coronavirus infections forced many restaurants and bars to close or scale back operations. “The people who had gotten hurt the most are still getting hurt the most,” Ms. Bovino said.The recovery in the number of available jobs posted online reversed course toward the end of December, according to job-search site Indeed’s measure of job-posting trends.
The lack of optimism with small businesses and a decline in household spending also takes out the surprise of these new unemployment numbers.
Employ America policy advisor Elizabeth Pancotti said the decrease the past two weeks could have been artificial:
The numbers of initial claims and those receiving state benefits typically pick up in the first week after the two-week period that spans Christmas and New Year holidays, said Elizabeth Pancotti, policy adviser at Employ America, a left-leaning advocacy group.“Any decrease we saw over the last two weeks we should view as artificial, either because offices were closed [during the holidays] or states were trying to implement the new extension,” she said, referring to the bill that President Trump signed Dec. 27. It added a $300-a-week supplement for those receiving unemployment benefits through March 14 and extended two federal pandemic programs that otherwise would have paid out their final benefits in December.
The vaccines might help open up the economy. The states with Democratic governors might find some other miraculous reason to open their states after Joe Biden’s inauguration next week.
New York Gov. Anthony Cuomo already said his state needs to reopen its economy.
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