In a welcome boost to the US economy, US Jobless weekly claims posted a surprise decline last week, tumbling to a yearly low and hitting a level not since seen before the Coronavirus pandemic took effect.
The US Department of Labor reported on Thursday that initial claims for state unemployment benefits dropped 97,000 to a seasonally adjusted 684,000 for the week ended March 20th, the lowest since the middle of March 2020.
Last week was the first time that the initial US weekly jobless claims fell below the key 700,000 mark. for the first time in a year as the employment situation in the world’s largest economy continues to improve.
The latest figures are a massive improvement from where the US jobless claims were at last summer. US Weekly jobless claims did not fall below 1 million until the end of August. In total, 22.4 million workers lost their jobs in just March and April alone. Almost 13 million of those jobs have been recovered since that period.
JPMorgan economist Daniel Silver wrote:
“The claims data can be noisy and we do not want to extrapolate too much signal from just one week of data, but overall it looks like the trend in initial claims has been moving down lately,”
“This suggests that the labor market has been improving in recent months as the drag from COVID-19 has been reduced, in part due to vaccine distribution.”
Daniel Silver
US Not Out of the Woods Yet
However, despite the very positive weekly jobless claims figures, there are still underlying issues with the US labor market. The US Department of Labor also reported a worryingly high 18.953 million people were still receiving unemployment checks this month.
Also, data for the prior week was revised to show an uptick of 11,000 more applications received than previously reported.
Approximately 5.6 million people were on extended benefits in the first week of March. Meanwhile, another 1.1 million Americans were on a state program for those that have passed their initial six months of financial assistance.
President Joe Biden said in his first press conference after the release of the economic news:
“There are still too many Americans out of work, too many families are hurting and I still have a lot of work to do,” “But I can say to you the American people, help is here and hope is on the way.”
President Joe Biden
