New jobless claims fall to pandemic low despite Delta variant concerns

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The number of Americans newly seeking jobless benefits fell last week to a fresh pandemic low as the labor market continued to recover — despite fresh concerns over the surge in COVID-19 cases driven by the Delta variant of the coronavirus, the feds said Thursday.

Initial filings for unemployment benefits, seen as a proxy for layoffs, reached 348,000 last week, down 29,000 from the prior week’s revised level of 377,000, according to data released Thursday by the Labor Department.

Economists surveyed by Dow Jones expected to see weekly new claims fall to 365,000.

It’s the fourth straight week the figure has declined.

Weekly new claims have fallen substantially from the 2020 peak of about 6.1 million new claims in a single week, but economists have expressed concern that in recent weeks, they appear to have settled at an elevated level.

Since the beginning of June, the number of weekly new claims has vacillated in a range between 368,000 and 424,000.

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, the feds added.

Continuing claims fell by 79,000 from the prior week’s revised level of 2.89 million, according to the new data. That figure stood at almost 14 million at the same time last year, in the thick of the pandemic.

Continuing claims have fallen significantly since peaks seen in 2020, but the figure remains about twice as high as pre-pandemic levels.

The latest data comes after the Bureau of Labor Statistics said earlier this month that the country added 943,000 jobs last month — more than expected as the labor market mounted a strong recovery in July after lackluster results in the spring.

But data from the Labor Department’s Job Openings and Labor Turnover Survey showed that the number of job openings nationwide soared to more than 10 million for the first time ever in June, showing a mismatch between demand for workers and the number of people seeking work.

And in recent days, companies have begun to warn that the surge in COVID-19 cases that’s being driven by the Delta variant is hitting corporate earnings forecasts.

Data from the Commerce Department that was released on Tuesday, showed that

The sell-off came as investors digested new data from the Commerce Department on Tuesday that showed American shoppers pulled back their spending in July even more than economists had expected.

A sign encouraging new hires is posted near a restaurant in Pennsylvania.
Paul Weaver/SOPA Images/LightRocket via Getty Images

Retail sales for the month fell 1.1 percent from June, the feds said, a steeper decline than the 0.3 percent drop expected by economists surveyed by Dow Jones, and comes after a 0.7 percent increase in June.

Stocks have seen modest declines this week as investors react to the mixed news.

Economists are closely watching jobs data for signs of recovery or backsliding in the labor market.

Seasonally adjusted claims graphic
Continuing claims have fallen significantly since peaks seen in 2020.
Department of Labor

Many economists and business owners have predicted an easier time hiring after the September cutoff of pandemic-boosted federal unemployment benefits that have given unemployed people an extra $300 per week.

Over a dozen states have already withdrawn from that federal program, and it will end in all states in the week ending Sept. 4.

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