Another 789,000 Americans Likely Filed New Unemployment Claims.

Another 789,000 Americans Likely Filed New Unemployment Claims.


States likely saw roughly the same number of individuals file for first-time unemployment benefits last week as during the prior week, with the weekly pace of new jobless claims easing slightly from December’s elevated levels.

 

The U.S. Department of Labor is set to release its weekly report on new jobless claims Thursday at 8:30 a.m. ET. Here were the main results expected in the report, compared to consensus estimates compiled by Bloomberg:

 

Initial jobless claims, the week ended Jan. 9: 789,000 expected vs. 787,000 during the prior week. Continuing claims, the week ended Jan. 2: 5.000 million expected vs. 5.072 million during the prior week.

 

New initial unemployment claims are expected to dip below 800,000 for a third straight week, showing signs of a tentative return to a downtrend after claims spiked throughout much of December. Initial jobless claims have stayed below the 1 million marks in every week since late August, after peaking at a record nearly 7 million in March.

 

“Recent jobless claims data suggest December may mark the trough in recent labour market weakness, particularly with additional financial support in the pipeline,” Nomura Chief Economist Lewis Alexander said in a note.

 

“However, significant downside risks for the labour market will persist until the pandemic comes more under control in the U.S.”

 

While both new and continuing jobless claims have eased significantly from their pandemic-era highs, both remain well above levels from before the pandemic, when new jobless claims were averaging at just over 200,000 per week and continuing claims were coming in well below 2 million.

 

And last week’s December jobs report showed that the U.S. economy was still about 9.8 million payrolls short of its February levels, with a still-elevated unemployment rate and depressed labour force participation rate. Though the vaccine rollout and additional fiscal stimulus may have alleviated some of the pressure, some economists are bracing for a multi-year recovery in the labour market.

 

“Weekly jobless claims were 787,000 to start the new year for the January 2 week which indicates the recession in the labour market isn’t over yet and hardship remains for millions of Americans without paychecks,” Chris Rupkey, chief financial economist for MUFG Union Bank, said in a note.

 

Based on last week’s data, more than 19 million Americans were still claiming unemployment benefits of some form, including 12.9 million individuals on pandemic-era federal unemployment programs.

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