- Roughly 21.1 million Americans claimed
unemployment insurance in the week that ended on May 16, a decline from the previous week's record of roughly 25 million, the Labor Department said on Thursday. - It was the first time that continuing claims, reflecting those receiving
unemployment benefits , had declined since coronavirus-related layoffs began in March. - It's a sign that hiring may be rebounding slightly as states continue reopening their economies from shutdowns to curb the spread of COVID-19.
This week's jobless-claims report contained a surprise: Total
The Labor Department said on Thursday that 21.1 million Americans claimed unemployment insurance in the week that ended on May 16, a decline from the previous week's record of roughly 25 million. Total unemployment, reflected in continuing claims, lags behind initial-claims data by one week.
"It's still an extremely large number, but if the number of people continuing to file for unemployment benefits is decreasing then this should be viewed as a positive for the economy as more people are going back to work as states begin the re-opening process," Chris Zaccarelli, the chief investment officer of the Independent Advisor Alliance, said in an email.
Initial claims, or new filings for unemployment insurance, also declined to 2.1 million in the week that ended on Saturday. It marked the eighth week in a row of declining filings and brought the total number of initial claims to more than 40 million since mid-March.
The weekly declines in total unemployment and initial claims came as the US begins to reopen its economy from sweeping lockdowns put in place two months ago to contain the spread of COVID-19. All 50 states have relaxed at least some of their restrictions.
Falling continuing employment suggests that as states reopen, businesses that had to lay off employees when the virus hit are hiring people back, said Ian Shepherdson, the chief economist at Pantheon Macroeconomics.
Still, the headline number may overstate the true extent of hiring, Shepherdson said. This is because California requires people to file for benefits every two weeks, and this report reflected an off week. California's continuing claims fell by 1.4 million, even though the state remained in a near-total lockdown during the week.
"We're discounting this as evidence of an improving labor market," Shepherdson said. There were more positive signs in other state numbers, however — Florida's continuing claims fell by 1.6 million during the week.
Some economists have been hesitant to cheer the decline or say it represents a turn in the labor market. While there may be signs that hiring is picking up, there's still a long way to go before the damage of the coronavirus pandemic is undone.
In addition, new programs have made the weekly jobless-claims report more difficult to parse. The slump in continuing claims this week may not be due to hiring, said James Knightley, the chief international economist at ING, but "may reflect more the fact the continuing claims numbers are state benefits and don't include the people claiming the Pandemic Unemployment Assistance — they are not eligible for regular or extended unemployment benefits."
Filings under the separate Pandemic Unemployment Assistance program, which expands benefits to those not previously eligible, fell to an unadjusted 1.19 million from 1.25 million, representing 32 states reporting. Including those filings, the total number of initial claims under federal and state programs declined to 3.1 million for the week that ended on Saturday.
The total number of people claiming benefits for all programs — state and federal — rose to about 31 million in the week that ended on May 9 from 27.3 million a week earlier. The measure is the broadest look at how many Americans are filing for unemployment and is not seasonally adjusted.
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