U.S.Weekly Jobless Claims Report and its Importance

Millions of people across the U.S. lost their jobs due to the coronavirus pandemic in 2020. Hopefully, the country’s economy started to recover, but it won’t be easy to solve all issues in a short period of time. Last week, the U.S. unemployment picture improved once again, with initial filings for unemployment insurance falling to another pandemic-era low. First-time jobless claims fell to 269,000 for the week ended October 30. Thus, jobless claims fell by 14,000 from the previous period.

Data about unemployment comes amid a rollback in special programs initiated during the crisis. The number of people who receive benefits under all programs fell by 157,731 to 2.67 million.

Importantly, the four-week moving average for claims, which helps smooth weekly volatility, dropped from 15,000 to 284,750. One year ago, the average was 751,000 and it was 225,500 in March 2020 just before the coronavirus pandemic.

People should take into account that continuing claims, which run a week behind the headline number, fell 134,000 to just over 2.1 million. Interestingly, all of the jobless totals are the lowest since March 14, 2020.

The jobless claims report comes a day before the Labor Department’s nonfarm payrolls count. It is expected to show growth of 450,000 for October.

Even though most claims report falls outside the survey week the country’s government uses for its official count.

Companies across the country are struggling to find employees. A chronic labor shortage caused several problems, including shorter hours, fewer products on shelves as well as escalating inflation. The Federal Reserve tried to address some of those issues on Wednesday. The country’s central bank made the decision to reduce the amount of support it is providing for the economy.

Jobless claims and local economy

The number of unemployed people in the country is not the only major problem. Unfortunately, U.S. productivity growth was worse than even the expected decline of 3.2%, falling 5% for the first time in decades.

In the meantime, unit labor costs jumped 8.3%. It is a combination of the productivity decline plus a 2.9% increase in hourly compensation.

Moreover, the trade deficit for goods and services totalled $80.9 billion in September, a new record. This data shows the severity of the problems. Furthermore, the growing shortfall came as the deficit with the world’s second-largest economy increased by $3.4 billion or 12%.

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