Number of Americans applying for unemployment drops to new pandemic low
The number of Americans filing claims for first-time unemployment benefits fell to a pandemic-era low, showing that the job market continues to strengthen despite the current surge of coronavirus around the country.
Some 348,000 people applied for first-time jobless benefits last week, the Labor Department said Thursday. That's a drop of 29,000 from the prior week's number, and the lowest since March 14, 2020. There were another 109,000 claims for Pandemic Unemployment Assistance, a federal program for self-employed and gig workers.
The latest claims numbers are "encouraging," Ian Shepherson of Pantheon Macroeconomics told investors in a research note. "We expect little change over the next couple weeks, but we hope to see clear new lows in September."
The weekly pace of applications for unemployment aid has fallen more or less steadily since topping 900,000 in early January. The drop coincides with the widespread administering of vaccines, which has led businesses to reopen or expand their hours and drawn consumers back to shops, restaurants, airports and entertainment venues, as well as cuts to jobless benefits in many U.S. states.
However, the spread of the highly contagious Delta variant threatens to disrupt the economy's recovery from last year's brief but intense recession. Some economists have already begun to mark down their estimates for growth this quarter as some measures of economic activity, like air travel, have started to weaken.
"Looking ahead, the virus could slow the return of workers still on the sidelines," economists at Oxford Economics said in a research note. However, "assuming the variant doesn't force renewed containment measures, we maintain our positive labor market outlook and foresee the economy recouping about 7.5 [million] jobs this year," they wrote.
Some 11.7 million people were receiving some sort of jobless aid as of the last week of July, the most recent data available, the Labor Department said.
The Associated Press contributed reporting.