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  4. US weekly jobless claims hit 1.5 million, bringing the 13-week total to 46 million

US weekly jobless claims hit 1.5 million, bringing the 13-week total to 46 million

Carmen Reinicke   

US weekly jobless claims hit 1.5 million, bringing the 13-week total to 46 million
Stock Market3 min read
  • US jobless claims for the week that ended on Saturday totaled 1.5 million, the Labor Department said on Thursday. That slightly exceeded the consensus economist estimate of 1.3 million.
  • That brought the 13-week total to 46 million. Thursday's report also marked the 11th straight week of declining claims.
  • Continuing claims, the aggregate total of people receiving unemployment benefits, totaled 20.5 million for the week that ended on June 6.

More than 1 million Americans filed for unemployment insurance last week as the economic fallout from the coronavirus pandemic continued to spur layoffs across the nation.

US jobless claims totaled 1.5 million for the week that ended on Saturday, the Labor Department said on Thursday. That slightly exceeded the consensus economist estimate of 1.3 million.

The figure raised the 13-week total to 45.7 million, meaning more than one in four American workers have lost a job during the pandemic. It's also more than the roughly 37 million people who filed unemployment-insurance claims during the year and a half of the Great Recession.

Still, unemployment filings last week fell slightly from more than 1.5 million in the previous week. The number of new filings has declined for 11 straight weeks.

"Today's numbers suggest that the reopening story may not be generating as much momentum for job creation as the surprise May payrolls number had suggested," said James Knightley, the chief international economist at ING.

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Continuing claims, which represent the aggregate total of people receiving unemployment benefits, came in at 20.5 million for the week that ended on June 6, down from 20.9 million in the previous report. The decline suggests that people are returning to work as the US economy reopens, but slower than economists had hoped.

The elevated number of continuing claims "sends a strong signal that any labor market recovery will happen in fits and starts," said Daniel Zhao, a senior economist at Glassdoor.

He continued: "The labor market's path to recovery is littered with obstacles that could smother the rebound, from the expiration of federal support for businesses and workers to depressed consumer demand to the resurgence in COVID-19 cases."

For the week that ended on Saturday, 46 states reported 760,526 initial claims in the Pandemic Unemployment Assistance program, which extended benefits to those not previously eligible, such as gig workers.

The figures contrasted with the May nonfarm-payrolls report, which said the US added 2.5 million jobs during the month.

But together the two reports show the ebb and flow of the labor market during the coronavirus pandemic and recovery. Some workers are going back to their jobs as restaurants and shops reopen, while others are being laid off now as companies emerge from lockdowns weaker and with less demand.

There are other signs that the US economy has started to rebound. Retail sales jumped by 17.7% in May, following two months of record declines, as people began shopping again, boosted by fiscal stimulus.

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In testimony before Congress on Wednesday, Federal Reserve Chairman Jerome Powell described the positive impact of "significant" fiscal support on the economy.

"We see it in consumer spending, in income data. We see it in payrolls. All of that is helping," Powell said, adding that there were still more than 20 million people who had been "dislodged" from their jobs because of the coronavirus pandemic.

He also urged Congress not to remove its support too quickly. "I wouldn't presume to prescribe exactly what you should or shouldn't do, but I would say it would be wise to look at ways to continue to support both people who are out of work and also smaller businesses that may not have vast resources," Powell said.

Some states — including Florida, Texas, and Nevada — have seen a spike in coronavirus cases since reopening, igniting fears of a second wave of infections that could further decimate the US economy if more shutdowns become necessary.

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