The number of new applications for unemployment benefits fell 23,000 last week to 238,000, less than expected.
The numbers reported Thursday morning by the Labor Department are a good sign for job growth. Weekly jobless claims are seen as a proxy for layoffs and have been watched closely in recent weeks for indications about how the omicron variant of COVID-19 has been affecting the labor market.
“Some welcome news on the job market: New seasonally adjusted unemployment claims posted a second straight weekly decline, falling more than expected,” said Mark Hamrick, Bankrate’s senior economic analyst. “If we continue to see more encouraging signs with COVID, it would be reasonable to expect the economic recovery will gather momentum again.”
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WHITE HOUSE BRACES FOR HORRIBLE JANUARY JOBS REPORT
Cases of the new variant peaked in mid-January after spiking over the holidays. While the strain is more contagious than previous iterations of the virus, it is also believed to be less deadly. Still, the large volume of people calling in sick resulted in supply chain disruptions and in companies implementing renewed coronavirus-prevention policies, such as remote work.
New cases are down 44% from two weeks ago, and hospitalizations are down 14%, although deaths are up 39%.
Thursday’s jobless claims numbers come a day before the January jobs report is released. The report is hotly anticipated and is expected to show either a decline in new job growth or an outright reduction in jobs.
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The White House has been working this week to prepare the public for the poor numbers, noting that the report counts people who have jobs but took unpaid time off as unemployed. Given the omicron surge, the report will include millions who were out of work at some point last month as a result of the illness.
“We expect that that will have an impact on the numbers,” said Brian Deese, the director of the National Economic Council. “We never put too much weight on any individual month; this will particularly be true in this month because of the likely effect of the short-term absences from omicron.”
