The number of new applications for unemployment benefits fell 29,000 last week to 348,000, the Labor Department reported on Thursday.
Thursday’s jobless claims number was less than forecasters’ expectations of 363,000 and represents the fourth-straight weekly decline.
“Some much-needed good news is found in jobless claims with fresh pandemic lows notched both for new and continuing claims,” said Mark Hamrick, Bankrate’s senior economic analyst. “The situation with claims occurs despite the recent headwinds including the resurgence of COVID cases, the flare-up of inflation, and receding fiscal stimulus.”
The new numbers follow the July jobs report, which beat expectations with 943,000 new jobs and a decline in the unemployment rate from 5.9% to 5.4%.
Jobless claims have been closely tracked each week as the United States attempts to pull away from the coronavirus pandemic, which resulted in a two-month recession and a protracted recovery punctuated by supply chain issues, labor shortages, and higher-than-anticipated inflation.
BIDEN ECONOMIC APPROVAL RATING DROPS AMID INFLATION FEARS
While jobless claims have declined significantly since even the start of the year, which featured new claims hovering over 800,000 per week, the country’s unemployment rate is also still much higher than before its pre-pandemic level of a mere 3.5%, and there are millions fewer people employed than in February 2020.
Despite the pace of gross domestic product growth, inflation has been an unwelcome side effect of surging demand. Consumer prices increased 5.4% in the year ending in July, the Department of Labor revealed. The price increases have been hotter than both the Federal Reserve and the Biden administration initially predicted.
While the vaccination effort has borne results — some 72% of adults have received at least one dose, and half of the country is fully vaccinated — the delta variant of COVID-19 began swirling around the country last month and caused a massive and rapid increase in new infections.
The delta variant, which now accounts for more than 98% of domestic COVID-19 cases, has begun prompting fears of the economy slowing down. Some companies have opted to delay reopening plans in lieu of the new strain, and both businesses and some municipalities have jump-started forms of vaccine mandates in a bid to clamp down on the rising number of new infections.
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Consumer sentiment has taken a ding because of the variant. Sentiment in early August dropped to its lowest level since 2011, according to the University of Michigan.
