The number of new applications for unemployment benefits fell 51,000 last week to 364,000, the Labor Department reported on Thursday.
Thursday’s jobless claims number was less than forecasters’ expectations of 390,000 new claims and a pandemic low. The number is lower than the week before, which had 415,000 new filings.
Indeed Hiring Lab economist AnnElizabeth Konkel said in a statement provided to the Washington Examiner that it is “always welcome news” to see declines in the number of jobless claims.
“Employer demand for labor is up, with some employers hiring urgently and offering hiring incentives. But on the job seeker side, there’s just not the same urgency due to COVID-19 concerns and financial cushions,” she said. “Labor market recovery is complex. While the current mismatch will hopefully sort itself out over the next few months, the delta variant remains a wild card.”
The new numbers come one day before the highly anticipated June jobs report, which will be a key indicator of how the economy is recovering under the Biden administration. While U.S. gross domestic product has been on the rise, employment numbers have consistently fallen short of expectations, prompting fears of a labor shortage.
EMPLOYERS DESPERATE FOR WORKERS TURNING TO SIGNING BONUSES
Forecasters predict that nonfarm payrolls increased by about 700,000, which is slightly more than May’s addition of 559,000 new jobs. The unemployment rate is expected to edge down from 5.8% to 5.7%.
While job growth and falling unemployment are positive factors for the economy, some economists and Republican lawmakers contend that the pace of labor market recovery is not as strong as it should be. Jobless claims are still well above their pre-pandemic level of just above 200,000 per week, and the unemployment rate is well above its February 2020 level of a mere 3.5%.
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Republicans, in particular, have said that the reason the labor market is lagging is because the supercharged $300 federal unemployment benefit boost is holding people back from finding jobs. More than two dozen states have ended, or are planning to end, the payments early in order to incentivize returns to the workplace.
Arkansas, Florida, Georgia, Ohio, Oklahoma, South Dakota, Texas, and Utah are among some of the states that have already ended unemployment benefits early. South Carolina did so on Wednesday, Maryland and Tennessee will do so on July 3, Arizona on July 10, and Indiana is set to do so on July 19.
