Jobless claims fall slightly
Rising virus cases trigger fears of economic damage
The number of Americans seeking unemployment benefits fell slightly last week to 751,000, a still-historically high level that shows that many employers keep cutting jobs in the face of the accelerating pandemic.
New jobless claims in Michigan also fell to 12,862 for the week ending Oct. 31, according to the U. S. Labor Department, down from 18,082 the previous week.
A surge in viral cases and Congress’ failure so far to provide more aid for struggling individuals and businesses are threatening to deepen Americans’ economic pain. Eight months after the pandemic flattened the economy, weekly jobless claims still point to a stream of layoffs. Before the virus struck in March, the weekly figure had remained below 300,000 for more than five straight years.
Thursday’s report from the Labor Department said the number
of people who are continuing to receive traditional unemployment benefits declined to 7.3 million. That figure shows that some of the unemployed are being recalled to their old jobs or are finding new ones. But it also indicates that many jobless Americans have used up their state unemployment aid — which typically expires after six months — and have transitioned to a federal extended benefits program that lasts an additional 13 weeks.
In Michigan continuing claims also fell to 195,588 for the week ending Oct. 24, the latest available, and an improvement from the 235,256 continuing claims reported the previous week.
Michigan’s official unemployment rate is 4.55% and has continued to fall since the pandemic struck with a fury in mid March and pushed jobless numbers to record levels.
The job market has been under pressure since the virus paralyzed the economy and has regained barely half the 22 million jobs that were lost to the pandemic in early spring. The pace of rehiring has steadily weakened — from 4.8 million added jobs in June to 661,000 in September. On Friday, when the government issues the October jobs report, economists foresee a further slowdown — to 580,000 added jobs — according to a survey by the
data firm FactSet.
Last week, nearly 363,000 people applied for jobless aid under a new program that extended eligibility for the first time to selfemployed and gig workers, up slightly from 359,000 the previous week. That figure isn’t adjusted for seasonal trends, so it’s reported separately.
All told, the Labor Department said 21.5 million people are receiving some form of unemployment benefits, though the figure may be inflated by double-counting by states.
The financial aid package that Congress enacted in the spring included a $600- a-week federal jobless benefit and $ 1,200 checks that went to most adults, in addition to assistance for small businesses. All that money has run out. Without additional federal aid, millions of unemployed Americans likely will lose all their jobless benefits in coming weeks and months, probably forcing them to scale back their spending. And many small companies could go out of business.
In the meantime, new
confirmed viral cases in the United States reached an all-time high of more than 86,000 a day, on average, in a sign of the worsening crisis that lies ahead for the winner of this week’s presidential election. By contrast, just two months ago, according to Johns Hopkins University, the sevenday rolling average for confirmed daily new cases was 34,000.
Cases of the virus are also trending upwards in Michigan. As temperatures fall, restaurants and bars will serve fewer customers outdoors. And many consumers may stay home to avoid infection. Dwindling business could force employers to slash more jobs during the winter.
The data firm Womply found that more businesses are shuttering in the face of a COVID resurgence and a potentially deteriorating economy: 21% of small businesses were closed as November began, it says, up from 20% in October, 19% in September and 17% in August. And sales growth is slowing at the companies that are open.