The number of Americans applying for unemployment benefits fell to 787,000 last week despite continued pressure on the labor market from the coronavirus pandemic, the feds said Thursday.
Last week’s seasonally adjusted initial jobless claims nevertheless brought the total filed during the COVID-19 crisis to more than 65.1 million — a number equivalent to nearly 41 percent of the nation’s total workforce.
The latest filings marked a surprise decrease from the prior week’s revised total of 842,000 and came in below economists’ expectations for 860,000 new claims, the US Department of Labor figures show.
“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 four times what we saw just one year ago,” said Robert Frick, corporate economist at Navy Federal Credit Union.
While the revised data show new claims dropping below that 800,000 for the second time in three weeks, last week’s figure was still well above the pre-pandemic record of 695,000 claims in a single week as well as the Great Recession’s peak of 665,000.
California appeared to play a large role in the latest decrease as the state updated its figures after putting them on hold for a few weeks to work through a backlog in claims and implement fraud prevention technology.
The feds recorded 158,877 new filings from California last week, down significantly from from the placeholder figure of 226,179 that was reported last week. But it’s unclear how much of that decline had to do with actual improvements in the labor market.
“This effect may be directly caused by the system reset as the system accepted or processed fewer new claims,” said Glassdoor senior economist Daniel Zhao. “More time is needed to understand whether the recent decline was driven by economic conditions or just system changes.”
Continuing claims, which measure sustained unemployment on a one-week lag, also continued their quick decline, falling by about 1 million to 8.3 million in the week ending Oct. 10 — the lowest level seen since the coronavirus caused claims to spike in mid-March.
But experts say the trend likely has to do with long-term jobless workers exhausting the 26 weeks of standard benefits that states generally provide. The drop in continuing claims has been accompanied by an increase in claims for the feds’ Pandemic Emergency Unemployment Compensation program providing up to 13 extra weeks of payments.
The most recent available figures show the number of people claiming those benefits indeed jumped by about 510,000 to almost 3.3 million in the week ending Oct. 3.