Number of Americans filing new claims for unemployment benefits in a week drops to 860,000 amid COVID-19 - but is still four times higher than the beginning of the year
The number of Americans filing new claims for unemployment benefits fell last week to 860,000 but still remains at historically high levels amid the coronavirus pandemic.
New claims for state unemployment benefits totaled 860,000 in the week ending September 12, according to the latest figures released by the Labor Department on Thursday.
Those figures are a decrease of 33,000 from the week prior.
While claims for jobless benefits dropped last week, they are still more than four times their level at the beginning of the year.
New claims for state unemployment benefits totaled 860,000 in the week ending September 12, according to the latest figures released by the Labor Department on Thursday
Before the pandemic ravaged the economy, the number signing up for jobless aid had never exceeded 700,000 in a week - even in the depths of the 2007-2009 Great Recession.
The Labor Department said 12.6 million are now collecting traditional unemployment benefits, which is up from 1.7 million a year ago.
Last week's claims covered the period during which the government surveyed businesses for the nonfarm payrolls component of September's employment report.
The economy created 1.371 million jobs in August after adding 1.734 million in July.
About 10.6 million of the 22.2 million jobs lost at the depth of the coronavirus crisis have been recovered.
The Federal Reserve on Wednesday kept interest rates near zero, noting that the pandemic 'will continue to weigh on economic activity, employment, and inflation in the near term and poses considerable risks to the economic outlook over the medium term'.
The Labor Department said 12.6 million are now collecting traditional unemployment benefits, which is up from 1.7 million a year ago
Fed Chair Jerome Powell said more fiscal support was likely to be needed, adding that though the labor market has improved 'substantially' it was 'a long way from maximum employment'.
Reports this week showed a slowdown in retail sales in August, which economists blamed on the reduction in extended unemployment benefits for millions of Americans. Production at factories also cooled last month.
After declining from a record 6.867 million at the end of March as businesses reopened after being shuttered to stem the spread of the coronavirus, claims have flattened, with layoffs spilling over to industries that were not initially impacted by the mandated closures.
The recovery remains fragile, imperiled by continuing COVID-19 cases and a failure to deliver another economic rescue package in Washington.
An extra $600 in weekly unemployment benefits ran out July 31, squeezing households that had depended on the beefed-up payments.
President Donald Trump issued an executive order August 8 providing a scaled-back version of the expanded jobless aid.
Most states signed up for federal grants that let them increase weekly benefits by $300 or $400. That program is expiring.
Also, $25 billion in government assistance for airlines' payroll expires this month.