• Thomas Parker

Weekly jobless claims fall below 1 million, first time since pandemic

First-time jobless claims were reported at 963,000 last week, which is the first time since mid-March that new weekly jobless claims totaled less than 1 million. Continuing jobless claims also fell by more than 600,000 last week.

Jobless claims had totaled over 1 million every week for 20 consecutive weeks following the United States entering a period of shutdown to contain the coronavirus. While there are signs of a strengthening labor market, the number of Americans collecting unemployment benefits for at least two weeks is still at 15.5 million, well above pre-pandemic levels.

The total marks the second week of declines since a provision expired July 31 that gave unemployment insurance recipients an extra $600 a week on top of their normal compensation. Congressional leaders are debating an extension as President Donald Trump issued an executive order that would provide an extra $400.

The total number of Americans receiving unemployment benefits fell sharply for the week ended July 25, down more than 3 million to 28.26 million, also pointing to a downward trend in joblessness. A year ago, that number was 1.7 million.

At the state level, the biggest drops in claims came from Florida (-23,180), New York (-21,905) and Texas (-11,233), according to numbers not adjusted for seasonality. The unadjusted total was 831,856, a decrease of 156,453. Some economists say the unadjusted number is more relevant as the current circumstances surrounding the pandemic are not subject to seasonality.

The report comes as the U.S. has recovered about half the jobs it lost during the Covid-19 closures, according to a recent nonfarm payrolls report. July saw a gain of about 1.8 million, bringing the unemployment rate down to 10.2%.

However, that remains well above the pre-pandemic level of 3.5%, which was the lowest in 50 years.

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