Jobless Claims Drop for First Time in Four Weeks

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Initial claims for jobless benefits fell to 326,000 last week after ticking up in September

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Meanwhile, the number of Americans claiming unemployment benefits has fallen sharply again, indicating the impact of states sweeping away many federal pandemic benefit programs.

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Initial claims accelerated during September due to accounting issues in California and supply shortages in Michigan, which led to short-term layoffs in the auto industry. Still, claims are near their lowest level since the start of the coronavirus pandemic, as the number of job openings in the US has outpaced the number of unemployed workers. Many employers have reported strong demand for workers, but are having difficulty filling open positions.

“When you filter out the noise and temp factors, employers are still holding on to the workers they have, knowing that if they let them, it’s going to be a lot harder to replace them,” says Robert The recent trend in jobless claims, said Frick, a corporate economist at the Navy Federal Credit Union.

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Claims have been lower than before in the pandemic despite a late summer spurt in coronavirus cases, creating new uncertainties for employers, especially those offering in-person services. Hiring in the leisure and hospitality industry was flat during August, and employment gains were slower overall compared to earlier in the summer.

Economists expect Labor Department figures to be released Friday will show US employers added 500,000 jobs in September, a pickup from last month, when the economy added 235,000 jobs. The unemployment rate is also expected to fall to 5.1% last month from 5.2% in August.

Meanwhile, the number of Americans receiving unemployment benefits overall is declining after programs designed to respond to the pandemic’s impact on the labor market ended last month in all states. One of those programs provided payments to gig workers and others who typically weren’t eligible to tap unemployment insurance. Another extended payment to individuals who terminate state benefits. In addition, the federal government funded an increase of $300 per week for all unemployment programs.

Continuing claims, a proxy for those receiving payments for all unemployment programs, fell to about 4.17 million in mid-September, from about 12 million at the end of August, before pandemic aid ended. Data accounting for all programs is not adjusted seasonally, and is reported at several-week delays. Some states are still reaping the benefits of the pandemic as they work through the backlog.

The end of increased and expanded benefits reduced federal spending on such programs. Weekly Labor Department disbursements to states for unemployment programs have fallen sharply since the end of pandemic aid in early September, to $1.65 billion for the week ending October 1. This is less than $6.2 billion for the week ended September 3 and the lowest weekly. amount since the start of the pandemic.

Amara Omeokwe [email protected] . Feather

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