DOLE STILL ON ROLL
1.5M more seek benefits, but recovery signs emerge
Another 1.5 million Americans applied for unemployment benefits last week as the coronavirus crisis kept the labor market under pressure, new data show.
Thursday’s seasonally adjusted figure means about 45.7 million people — more than the entire population of Argentina — have tried to join US unemployment rolls since the crisis began about three months ago.
The latest numbers from the US Department of Labor show a gradual but shaky recovery in the job market amid a second wave of pandemic-related layoffs, experts said.
“This report confirms that labor market problems have shifted away from mass closings and layoffs in immediate response to shutdown orders, and toward still-catastrophic numbers of new layoffs related to the long-term, reverberating effects of a recession,” said Andrew Stettner, an unemployment insurance expert and senior fellow at the Century Foundation think tank.
Initial jobless claims fell for the 11th straight week as states continued to ease coronavirus lockdowns that led to record unemployment. But last week’s total was still more than twice the Great Recession’s peak of 665,000. Economists were expecting 1.3 million claims.
The number of people filing continued claims, which are reported on a one-week lag, also dropped slightly to 20.5 million in the week ending June 6, the feds said.
That figure tracking continued unemployment has essentially plateaued in recent weeks, pointing to “a recovery that is struggling to stay the course,” Glassdoor senior economist Daniel Zhao said.
“The labor market’s path to recovery is littered with obstacles that could smother the rebound, from the expiration of federal support for businesses and workers, to depressed consumer demand, to the resurgence in COVID-19 cases,” Zhao said.
The continued claims could drop significantly in August after the feds stop paying the extra $600 a week in benefits provided under the CARES Act stimulus bill, according to Yelena Shulyatyeva, senior US economist at Bloomberg Economics. Those funds have reportedly given some workers more money in unemployment benefits than they would normally earn on the job.
The number of people claiming Pandemic Unemployment Assistance, the special program created for gig workers and others not eligible for traditional benefits, also fell to about 9.7 million in the week ending May 23, from roughly 10.9 million the prior week, the feds said.
The coronavirus and efforts to stop its spread have led to job losses across a range of industries, from retail and restaurants to health care and financial services. Some of those jobs have come back as many states began to reopen, but the Federal Reserve still expects the unemployment rate to sit at 9.3 percent by the end of this year.
“There is a lot of different quirks in statistical reporting that may explain the differences,” Shulyatyeva said. “But I think the overall picture is that the labor market is improving, but it is improving at a very gradual pace.”