Initial Jobless Claims Dropped to the Lowest Level

The unemployment rate in the U.S. was low, but the coronavirus pandemic changed the situation. Unfortunately, millions of people all over the country lost their jobs. This is not the end of the story, as some of them are still out of work. Hopefully, initial jobless-claims applications last week reached their lowest level of the pandemic crisis, as hiring continues despite the rising coronavirus cases in the country. According to the Labor Department, first-time jobless claims for unemployment benefits totaled 712,000 last week.

Importantly, that marked a decline from the upwardly revised level of 787,000  a week earlier. Interestingly, this could be connected with counting issues associated with the Thanksgiving holiday.

The jobs market demonstrated resilience even in the face of the new wave of coronavirus cases. As a reminder, claims reached 6.9 million in late March, but remain above the pre-pandemic record. Moreover, continuing claims also fell by 569,000 to 5.52 million.

Jobless claims and Government Accountability Office

Interestingly, the claims data comes just one day before the Labor Department releases its closely watched nonfarm payrolls report for November. According to the Government Accountability Office (GAO), weekly jobless claims figures have been inaccurate during the pandemic. Importantly, the Government Accountability Office cited uncounted backlogs and fraud as well as other discrepancies at the state level as obstacles to providing an accurate event.

People should take into account that, the GAO recommended that the Labor Department issued a disclaimer regarding the potential inaccuracy of the count. However, the Labor Department did not mention this information in this report.

Importantly, Pandemic Unemployment Assistance claims actually declined for the week, falling by more than 30,000 to 288,701. As a reminder, the program provides benefits to those not normally eligible prior to the pandemic.

It is worth noting that fillings continued to rise for the emergency pandemic program, which addresses those who have lost their normal benefits. Notably, that total increased nearly 60,000 to 4.57 million for the week ended November 14, the most recent period for which data is available.

According to unadjusted data, California, Texas, Michigan reported the biggest drops at the same level. However, jobless claims rose in Illinois as well as Oregon.

The coronavirus pandemic created a lot of problems for the country’s economy. People are trying to cope with various challenges. Lawmakers should reach an agreement regarding another stimulus package by the end of the year.