Unemployment filings dip for third week in a row
The number of Americans filing for jobless benefits last week has fallen for four weeks in a row, suggesting that layoffs are slowing as the job market climbs out of a deep trough.
Some 793,000 people applied for jobless benefits in the week ending February 6, the Labor Department said Thursday. That's a drop of 19,000 from the prior week's number. Another 334,000 people applied for Pandemic Unemployment Assistance, a special federal program for the self-employed and gig workers.
Before the coronavirus slammed the economy last March, unemployment filings hovered around 250,000 a week and never exceeded 700,000 a week, a record set in the 1982 recession.
"Collectively, there has been massive improvement since last spring, but no aspect of unemployment claims are even close to pre-COVID levels," AnnElizabeth Konkel, economist at the Indeed Hiring Lab, said in a note.
20 million still on unemployment
Though the unemployment rate fell in January to 6.3% from 6.7%, that was mainly because many people who had lost jobs stopped looking for work. The government doesn't count people as unemployed unless they're actively seeking work.
"Overall, an extraordinarily high number of people remain dependent on government support, indicative of ongoing strains in the labor market," Rubeela Farooqi of High Frequency Economics told investors in a report.
A sign of those strains: The number of people receiving unemployment benefits rose in mid-January. Some 20.4 million people collected some sort of benefits on January 23, the latest period for which data are available. That's up from 17.8 million the week before.
"While the progress of vaccination efforts has stymied an increase in new layoffs in December, the rate at which unemployed workers are finding new jobs and exiting the jobless rolls has yet to keep pace," Andrew Stettner, senior fellow at The Century Foundation, said in a note.
Federal Reserve Chair Jerome Powell described the nation's "real" unemployment rate as closer to 10% in remarks in New York City on Tuesday, pointing to the millions of workers who have dropped out of the nation's labor force during the pandemic and those who are miscategorized as employed.
"At present, we are a long way from such a labor market," he said.
"Unfortunately, even those grim statistics understate the decline in labor market conditions for the most economically vulnerable Americans," Powell added, noting that employment for lower-income workers hasn't rebounded much in recent months and greater joblessness among minorities.
The unemployment rate for Blacks and Hispanics in January was 9.2% and 8.6%, respectively, compared with 5.7% for Whites, according to the Labor Department.
The Associated Press contributed reporting.