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New claims for unemployment dropped last week, the government reported on Thursday, fueling renewed optimism in the staying power of the economic rebound.
A total of 709,000 workers filed first-time claims for state unemployment benefits in the week that ended March 6, 47,000 lower than the week before, the Labor Department said. In addition, there were 478,000 new claims for Pandemic Unemployment Assistance, a federal program covering freelancers, part-timers and others who do not routinely qualify for state benefits, an increase of 42,000.
Neither figure is seasonally adjusted. On a seasonally adjusted basis, new state claims totaled 712,000.
New claims for state unemployment benefits had been drifting lower in recent weeks, as restrictions across the country have begun to lift — a trend that many economists expect will continue.
“The pieces are falling into place for a more substantial improvement in the labor market,” said Sarah House, a senior economist at Wells Fargo.
The Labor Department reported last week that employers added 379,000 jobs in February, an unexpectedly robust number that reinforced confidence in the strength of the economic recovery roughly one year into the pandemic-induced downturn. The gains came largely in the hard-hit leisure and hospitality industries.
Although initial jobless claims have fallen significantly since last spring, the economy has a long way to go until it reaches pre-pandemic levels. All told, there are about 9.5 million fewer jobs than there were a year ago. More than four million people have dropped out of the labor force, a group not included in the most widely cited unemployment rate.
“We’re still not yet at the phase of the recovery where we’re seeing the floodgates open up,” said Daniel Zhao, senior economist with the career site Glassdoor. “I don’t think it’s quite fair to call what we’ve done so far ‘reopening’ because there’s still a lot of people who are out of work and a lot of businesses that are closed.”
But as vaccination rates climb, the weather warms up and more government help arrives, via President Biden’s $1.9 trillion relief plan, many economists expect a vibrant economic resurgence.
“We’re seeing a huge pickup in hiring,” said Julia Pollak, a labor economist with the employment site ZipRecruiter. “I think for many employers, it’s becoming real, and for many job seekers it is as well.”
Source: The NY Times
Keyword: New state unemployment claims fall, a fresh sign of economic hope.