The number of Americans newly seeking jobless benefits unexpectedly rose last week even as the summer surge in COVID-19 cases driven by the Delta variant appears to have peaked and has begun to decline, the feds said Thursday.
Initial filings for unemployment benefits, seen as a proxy for layoffs, rose to 362,000 last week, up 11,000 from the prior week’s level of 351,000, according to data released Thursday by the Labor Department.
Economists surveyed by Dow Jones expected to see weekly new claims drop to 335,000.
The overall rise in new claims was fueled at least in part by jumps in California and Michigan, Bankrate’s senior economic analyst Mark Hamrick noted.
“Negative surprise alert: New jobless claims have risen for a third straight week, surging by 11,000 to 362,000,” he said.
“As we get updates on some of the lagging figures, the Labor Department says a total of five million Americans were receiving some form of jobless assistance in the week ending Sept. 11, which marked a weekly decline of six million as federal pandemic benefits were expiring,” he added.
Weekly new claims have fallen substantially from the 2020 peak of about 6.1 million new claims in a single week, but remain above pre-pandemic levels.
Thursday’s report marks the third consecutive week of rising new jobless claims in a surprise setback for the labor market.
The country was averaging just over 200,000 new claims per week in 2019.
More than 2.8 million Americans remained on traditional state unemployment benefits as of Thursday, the feds added.
Continuing claims fell by just 18,000 from the prior week’s revised level, according to the new data. That figure stood at about 13 million at the same time last year, in the thick of the pandemic.
Those claims have fallen significantly since peaks seen in 2020, but the figure remains almost twice as high as pre-pandemic levels.
The economic recovery has made strides in recent months, but inflation and a nationwide labor shortage have held back further progress, economists say.
While this month’s consumer price index report from the Bureau of Labor Statistics showed that some of the goods responsible for the huge spikes in prices this summer are beginning to ease, the labor market is still struggling.
The country added only 235,000 jobs last month, falling way short of expectations and stoking concerns that the economic recovery is stalling out.
“There’s no question the Delta variant is why today’s job report isn’t stronger. I know people were looking and I was hoping for a higher number,” President Biden said earlier this month of the report.
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