Fewer people are receiving unemployment benefits now than in more than half a century, the Department of Labor reported Thursday.
Continuing claims for unemployment benefits fell to 1,417,000, last week, the lowest level since 1970 and a sign that jobs are abundant and the labor market is tight.
Additionally, the number of new applications for unemployment benefits fell by 2,000 last week to 184,000, remaining near the lowest level for initial claims since 1969.
Weekly new jobless claims are seen as a proxy for layoffs and have been watched closely as the Federal Reserve hiked its interest rate target. This week’s decline continues a generally downward trend in jobless claim reports since the omicron variant of the coronavirus peaked in mid-January.
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“The overall picture with unemployment claims is one of remarkable stability, underscoring the continuing strength of the job market. For now, despite no shortage of headwinds, layoffs are akin to an endangered species,” said Mark Hamrick, senior economic analyst at Bankrate.
The overall shift toward decreasing layoffs and fewer people receiving unemployment benefits is a welcome development for President Joe Biden, who is facing tumbling approval ratings and public displeasure with how his administration has handled the painful inflation afflicting the country.
New jobless claims have been in retreat over the past year. Around this time in April of last year, new claims were averaging more than 550,000 per week.
Thursday’s report comes after data were released that showed consumer prices increased 8.5% in the 12 months ending in March, a faster rate of inflation at any time since December 1981, when the country was still fighting back the Great Inflation.
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The rapidly increasing prices paired with the decreasing jobless claims gives the Federal Reserve, which just raised interest rates for the first time in years, an increased boost in confidence for its plans to tighten monetary policy and continue raising interest rates.
In other positive economic news, the economy added 431,000 jobs in March, and unemployment fell to pre-pandemic rates, showing that the labor market is quite hot. Labor participation was also up in March.
