Jobless claims fall but remain elevated

The U.S. job market continues to struggle, held back by the coronavirus, the slow rollout of vaccines and the loss of overall economic momentum.

The Labor Department reported Thursday that new claims for unemployment benefits fell last week for the third straight week but remained at extraordinarily high levels by historical standards.

Last week brought 816,000 new claims for state benefits, compared with 840,000 the previous week. Adjusted for seasonal variations, last week’s figure was 779,000, a decrease of 33,000.

There were 349,000 new claims for Pandemic Unemployment Assistance, a federally funded program for part-time workers, the self-employed and others ordinarily ineligible for jobless benefits. That total, which was not seasonally adjusted, was down 55,000 from the week before.

“These numbers were slightly encouraging,” said Gregory Daco, chief U.S. economist at Oxford Economics. “While still alarmingly high, it’s better than the spike that occurred at the beginning of January.”

Daco noted that the wait in passing a new stimulus package in December amid partisan battles in Washington may have delayed some claims that ended up being filed in January after the package was signed into law. Now that surge seems to be clearing.

Nevertheless, for workers in the hardest-hit industries, conditions remain difficult.

“It’s been a rough winter, especially for folks in the leisure and hospitality sector and the food sector,” said David Deull, an economist at research and analysis company IHS Markit.

The latest data strengthens the argument for more stimulus, economists say, a key policy position of the Biden White House. The $900 billion aid package passed in December helps many unemployed workers only through mid-March.