Jobless claims: Another 385,000 Americans filed new unemployment claims last week

·Reporter
·3-min read

New weekly jobless claims dipped last week to come in near consensus estimates, trending down but still coming in well above pre-pandemic levels as the labor market's recovery trudges forward.

The Labor Department released its weekly jobless claims report on Thursday at 8:30 a.m. ET. Here were the main metrics from the print, compared to consensus estimates compiled by Bloomberg:

  • Initial unemployment claims, week ended July 31: 385,000 vs. 383,000 expected and a revised 399,000 during prior week

  • Continuing claims, week ended July 24: 2.930 million vs. 3.255 million expected and a revised 3.296 million during prior week  

Though initial jobless claims are down significantly from their weekly pace of more than 1 million this time last year, they are still markedly elevated compared to their 2019 weekly average of just over 200,000. 

Continuing unemployment claims came in lower than expected, breaking back below 3 million for the first time since mid-March 2020. 

The total number of claimants across all programs also ticked down marginally, according to this week's report, falling by nearly 200,000 to come in just below 13 million. However, that came even as nearly half of U.S. states phased out federal augmented unemployment benefits this summer ahead of the national expiration date in September, with these states' leaders hoping the move would incentivize workers to rejoin the labor market.

In recent weeks, however, concerns over the spread of the Delta variant have increased, confounding many employers' in-person, return-to-office plans and deterring some individuals from taking high-contact jobs. These concerns compounded with existing complications around finding child care during the summer. Plus, many economists have said the ongoing enhanced federal unemployment support across dozens of states has kept at least some workers on the sidelines until the fall. 

"The Delta variant is just one part of the uncertainties that are currently characterizing the labor market. There are other bottlenecks that were there before the Delta variant really became part of the national attention, including child care and the lack of child care over the summer," Nela Richardson, ADP chief economist, told Yahoo Finance on Wednesday.

"[There's been] this hiring mismatch with firms all wanting to hire this summer, while consumers and workers may have benefitted from transfer payments or generous unemployment payments that keep them off the payrolls until the fall," she added. "All of these things are coming together to show up in a very uneven, but still progressive labor market recovery." 

Last week, a number of states saw marked improvements in new filings. Pennsylvania's new claims fell by 6,400 on an unadjusted basis, followed by Texas and Florida with declines of more than 4,400 and 3,800, respectively. 

But while new claims trended lower in most states, other metrics demonstrated ongoing strain in some of the most populous areas of the country. By insured unemployment rate, or number of those claiming unemployment benefits as a percentage of total state population, California saw the biggest level at 5.2% for. the week ended July 17. This was followed by Puerto Rico and Nevada with rates of 5.1% and 4.1%, respectively. These compared to a national average insured unemployment rate of 2.4% for the same week. 

Outside of the weekly unemployment claims reports, other data on the labor market have also been choppy. Wednesday's monthly ADP jobs report showed that private payrolls rose by just 330,000, or less than half the sum consensus economists had been looking for. Friday's "official" monthly jobs report is still expected to show a slight pick-up in hiring, however, with non-farm payrolls expected to rise by 870,000, compared to 850,000 in June. 

Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck

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