Over 1.18M Americans filed for unemployment last week, lowest level since pandemic began
Economists surveyed by Refinitiv expected 1.41M new claims
Small business expert Gene Marks shares his expertise regarding coronavirus-hit small businesses, getting people back to work and enhanced unemployment benefits, which are set to expire this week.
The number of Americans applying for unemployment benefits fell to the lowest level since the coronavirus pandemic started in mid-March.
The latest jobless claims figures from the Labor Department, which cover the week ending August 1, show that more than 1.18 million workers sought aid last week, pushing the total number since the shutdown began to more than 55 million.
Economists surveyed by Refinitiv expected 1.41 million new claims. Last week's total was revised up by 1,000 to 1.435 million.
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The report comes amid escalating fears that a flare-up in COVID-19 cases and a fresh round of business closures will derail the economy's early recovery just as the supplemental $600 in unemployment benefits expired.
But the figure -- the lowest since March 14, just as the pandemic brought the economy to a grinding halt -- indicates there's still some driving power behind the job market's turnaround, even as employers continue to slash jobs.
It marks the 20th consecutive week that jobless claims came in above 1 million; before the pandemic, the record high was 695,000, set in 1982.
Continuing claims, the number of people receiving benefits after an initial week of aid fell by 844,000 to 16.1 million.
“Falling unemployment insurance claims is a positive sign the recovery is progressing cautiously," said Daniel Zhao, senior Glassdoor economist. "However, this report also shows that unemployment benefits remain a vital life preserver for tens of millions of Americans during a health and economic crisis."
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Democratic leaders and White House officials are currently negotiating another emergency aid package, but are at loggerheads over the extension of the sweetened jobless benefits. Republicans have argued that it disincentivizes Americans from returning to their jobs, and have instead proposed a $200-a-week replacement. Democrats have maintained the benefits need to be extended through the end of the year and have made it a key sticking point in stimulus talks.
Adding to the urgency is the Labor Department's July jobs report, slated to be released Friday. The unemployment figures will shed light on whether a fresh round of business closures amid a spike in COVID-19 cases is dampening the nation's economic and jobs market recovery.
It's expected to show the U.S. economy added 1.6 million jobs last month, down from June's gain of 4.8 million, a record high. Analysts anticipate unemployment will edge lower to 10.5 percent from 11.1 percent.