Jobless filings in U.S. still high

Applications for jobless benefits remained high last week, even as the collapse of stimulus talks in Washington raised fears of a new wave of layoffs.

Unemployment filings have fallen swiftly from their peak of more than 6 million last spring. But that progress recently has stalled at a level far higher than the worst weeks of past recessions. That pattern continued last week, the Labor Department said Thursday: More than 800,000 Americans filed new applications for state benefits, before adjusting for seasonal variations, roughly in line with where the total has been since early August.

“The level of claims is still staggeringly high,” said Daniel Zhao, senior economist at career site Glassdoor. “We’re seeing evidence that the recovery is slowing down, whether it’s in slowing payroll gains or in the sluggish improvement in jobless claims.”

That slowdown comes as trillions of dollars in government aid to households and businesses has dried up. Prospects for a new stimulus package, already dubious in a divided Washington, appeared to fall apart this week when President Donald Trump said he was pulling out of negotiations. Economists across the ideological spectrum warn that the loss of federal help will lead to more layoffs and business failures, along with more pain for families.

Adding to the challenge for analysts and forecasters, the pandemic has thrown the data itself into disarray. For the second week in a row, the jobless claims data carried a Golden State-size asterisk: California last month announced that it would temporarily stop accepting new unemployment applications while it addressed a huge processing backlog and installed procedures to weed out fraud. The state began accepting new filings this week and is expected to resume reporting data in time for next week’s report.

Separate data from the Census Bureau on Wednesday showed that 8.3 million Americans reported being behind on rent in mid-september, and 3.8 million reported that they were likely to be evicted in the next two months. Both figures have changed little since August.

“It seems increasingly unlikely that we’ll have a deal before the election, and bills are due now,” Zhao said. “Every week that passes puts extra pressure on workers’ households and small businesses, so any delay in the stimulus is going to have a meaningful impact on Americans.”