The number of new applications for unemployment benefits last week was 837,000, the Labor Department reported Thursday, as claims remain stubbornly high.
Forecasters had projected roughly 850,000 new claims.
The economy is roughly six months into the pandemic, and jobless claims remain at historically high levels. In January, before the coronavirus hit the United States, weekly claims were just over 200,000. Since late September, claims have hovered just under 900,000, which is an improvement from prior weeks.
“This marks 28 weeks since the COVID-caused downturn ignited an eruption of historic and, as we see once again, sustained job loss, even as some employers bring employees back to work,” said Mark Hamrick, a senior economic analyst for Bankrate.
Jobless claims fell below the psychologically important 1 million mark at the end of August. Before then, as the coronavirus forced economic disruption to slow its spread, layoffs and thus weekly claims for unemployment benefits skyrocketed in late March to as high as 6.9 million.
The number of beneficiaries then dropped precipitously through the end of May as many workers returned to the job, but that decline stalled at the end of summer.
Thursday’s numbers came with a caveat: California has announced a two week pause in its processing claims in an effort to buy time to reduce its claims processing backlog and implement fraud prevention technology. As a substitute for new numbers, Thursday’s release subbed in the previous week’s tally for California.
The data for the total number of workers receiving benefits of all kinds and durations, 26.5 million as of mid-September, compared to 1.4 million in the comparable week in 2019, is thought to overstate the true extent of unemployment because of the problems with errors, double counting, and fraud.
One area of concern for the entire country is the Pandemic Unemployment Assistance program, which provides for unemployment insurance for people sidelined by the epidemic who normally wouldn’t be eligible for benefits, such as gig workers whose business dried up. The Labor Department reports that nearly 12 million jobless workers are eligible for the benefit, but economists say that number could be off by millions.
Over 650,000 newly claimed the benefit last week, which is close to the number of claims for regular unemployment benefits.
Still, the week-to-week numbers suggest that employers are shedding jobs at extreme rates.
Some of the states with the highest unemployment rates were Hawaii at 21.3%, Nevada, with a 14.7% rate, and New York 13.7% jobless rates for the week ending Sept. 12.
The largest increase in initial claims for regular benefits in the week ending Sept. 19 were New York, 7,893, Georgia 7,336, and Massachusetts 5,186.
The jobless situation could get worse in the weeks ahead as American Airlines Group Inc. and United Airlines Holdings Inc. will reportedly move forward with cutting over 30,000 jobs as Congress has yet to advance another relief package.
The CARES Act enacted in March provided the airline industry $25 billion in aid as long as no workers are furloughed before Oct. 1. The airline executives have asked for an additional $25 billion in aid, which would be expected to keep workers employed through March 2021.
Treasury Secretary Steven Mnuchin and Speaker Nancy Pelosi concluded several hours of talks Wednesday afternoon without a new deal on a coronavirus aid package, but the two sides said they would continue to negotiate.
