The number of new applications for unemployment benefits drooped to 787,000 last week, the Labor Department reported on Thursday.
Forecasters had projected 870,000 new jobless claims.
“The numbers are noisy, but weekly unemployment claims came in below 800,000, which is still good news for Americans who have seen those claims settle in at levels about 4 times what we saw just one year ago,” said Robert Frick, corporate economist at Navy Federal Credit Union.
For last week, California had the most claims, with over 158,000. Coming in a distant second was New York, with roughly 56,000 claims. When combined, the claims from these two states are nearly the total number of claims made in comparable weeks last year.
In addition to claims for regular benefits, more than 345,000 workers filed new claims for the Pandemic Unemployment Assistance program, which provides unemployment insurance for people sidelined by the epidemic who normally wouldn’t be eligible for regular benefits, such as gig workers whose business dried up. Combining both regular and PUA claims, roughly 1.1 million jobless workers filed for relief last week.
Another troubling sign is that claims increased for the Pandemic Emergency Unemployment Compensation program, which gives an additional 13 weeks of benefits to those who have used up their initial 26 weeks. It increased by more than 500,000 last week, and now, roughly 3.3 million jobless workers are on extended benefits.
Despite the drop in regular benefit claims, the economy is over seven 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.
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 employment, but that decline stalled at the end of summer.
As claims remain historically high, Washington has been incapable of agreeing on additional relief to jobless workers and businesses struggling to stay open.
The White House is eager to strike a coronavirus aid deal with Democrats by the end of this week that will likely cost far more than House or Senate Republicans are willing to support.
Despite a warning from Senate Majority Leader Mitch McConnell that the White House was pushing forward on a spending package that would divide Republicans, the bipartisan talks inched toward a deal Wednesday, with a desire to finalize it this week.
