U.S. jobless claims at 730K, still high but fewest in 3 months

The number of Americans seeking unemployment benefits fell sharply last week in a sign that layoffs may have eased, though applications for aid remain at a historically high level.

Jobless claims declined by 111,000 from the previous week to a seasonally adjusted 730,000, the Labor Department said Thursday. It is the lowest figure since late November and the sharpest one-week decline since August. Still, before the virus erupted in the United States last March, weekly applications for unemployment benefits had never topped 700,000.

The latest figures coincide with a weakened job market that has made scant progress in the past three months. Hiring averaged just 29,000 a month from November through January. Though the unemployment rate was 6.3% in January, a broader measure that includes people who have given up on their job searches is closer to 10%.

All told, 19 million people were receiving unemployment aid as of Feb. 6, up from 18.3 million the previous week. About three-quarters of those recipients are receiving checks from federal benefit programs, including programs that provide jobless aid beyond the 26 weeks given by most states.

Last week’s drop in applications was concentrated in two states, California and Ohio, where they fell by a combined 96,000. Ohio officials had said earlier this month that a surge in new applications was driven in part by a jump in potentially fraudulent claims. That now appears to have faded.

California’s system operates on a biweekly bases, which can make its weekly data choppy.

This month’s devastating winter storms and power outages in Texas and some neighboring states might have also disrupted the filing or processing of some claims. Applications for jobless aid fell by one-sixth in Texas to about 35,000.

Yet last week’s decline in applications was broadbased, with 36 states and the District of Columbia reporting fewer people seeking unemployment benefits. That suggests that employers might be cutting fewer jobs.

“The drop may be signaling a turning point for labor market conditions,” said Nancy Vanden Houten, lead economist at Oxford Economics.