New jobless claims stable but still historic levels

Nationally, 860K workers filed new claims last week

New jobless claims remained at historically high but stable levels last week, indicating a plateau in the recovery of the nation’s economy with Congress still at odds over additional stimulus to offset the effects of the coronavirus pandemic and with seven weeks to go to a contentious presidential election.

Nationally, another 860,000 workers filed new jobless claims for the week ending Sept. 12 – the third week that new jobless claims came in below a million, according to the most recent numbers released by the U.S. Labor Department.

Michigan saw 17,392 new jobless claims, the lowest number

since March when the pandemic forced statewide shutdowns and mass layoffs and a slight decline from the 17,844 new claims filed the week before.

Last week’s initial claims were revised upward, but week-to-week new jobless claims appear to be leveling off in Michigan, and continuing jobless claims continue to improve though at still at historic levels.

Reporting of continuing claims lag initial claims by a week.

But the numbers for Michigan indicate a slightly improving economy. For the week ending Sept. 5, there were 362,697 continuing claims in the state system, down considerably from the 439,244 continuing claims reported the week before, and Michigan’s unemployment rate improved to 8.42%.

Michigan’s Bureau of Labor Market Information indicates the pandemic-driven layoffs have disproportionately affected workers based on education.

The 12 month moving average for unemployment through August was 15.3% for people with less than a high school education, 9.8%

for high school graduates, 8.6% for workers with some college education, and 3.7% for college graduates, according to the Michigan Labor Market Information website.

The economic recovery remains fragile as schools begin to reopen, and the failure to deliver another economic rescue package in Washington.

An extra $600 in weekly unemployment benefits ran out July 31, and a presidential executive order that provided enhanced unemployment benefits of $300 to $400 is also expiring.

Meanwhile, Congress appears deadlocked over the size of additional assistance

to workers and businesses as the presidential election season enters its final weeks.

Unemployment claims “remain high even as economic activity is resuming more fully,” Rubeela Farooqi, chief U.S. economist at High Frequency Economics, wrote Thursday. “The risk going forward continues to come from virus outbreaks and intermittent interruptions to activity. Overall, the labor market is less weak compared to April but remains at risk of permanent damage from repeated closures.’’