By
Steve Muchoki
April 16th, 2024
Jobless claims last week totaled 3.17 million, the U.S. Labor Department reported on Thursday. Though the numbers remain elevated, it’s the lowest total since after the coronavirus was declared a pandemic.
Unemployment rolls continued to accumulate in the U.S. last week, even though jobless claims hit their lowest level since the economy went into lockdown made to combat the effects of the COVID-19 outbreak. The number of initial jobless claims in the United States decreased by 677,000 in the week ending May 1 compared to the week prior to coming in at 3,169,000, reaching a total of 33.5 million over the past seven weeks, the U.S. Department of Labor unveiled on Thursday.
This, however, was a bit higher than the 3.05 million expected by economists surveyed by Dow Jones and below the previous week’s 3.846 million, which was revised up by 7,000. Be it as it may, even though the numbers may seem blunt, it was the lowest total since the second week of March, shortly after the World Health Organization declared the coronavirus strain a pandemic.
More Jobless Claims in the U.S., Seasonally Adjusted Insured Unemployment Rate was 15.5%
The four-week moving average was 4,173,500, that represents the fall of 861,500 from the previous week’s revised average.
The seasonally adjusted insured unemployment in the week ending April 25 stood at 22,647,000, showing an increase of 4,636,000 from the last week’s revised level to reach an all-time high. Meanwhile, the advance seasonally adjusted insured unemployment rate was at 15.5% for the same week, jumping 3.2% from the previous week’s figure.
Stock market futures reacted little to the data and continued to indicate a 300-point gain at the open for the Dow Jones Industrial Average. The Dow Jones Industrial Average advanced 0.73% at the opening bell while the Nasdaq 100 rose 1.32%. The S&P 500 gained 1.05%. Today, the growth continued. The Dow surged 1.57% at 1:49 am ET while the Nasdaq 100 soared 1.43% at the same time. A minute later, the S&P 500 went up by 1.50%.
Numbers not adjusted for seasonality showed overall of 2.85 million claims, which represents a decline of 646,613, or 18.5%, from the previous week. Some analysts believe the unadjusted numbers are more relevant for the momentary extraordinary situation as they are not as impacted by seasonal factors.
For example, Florida was most accountable for the big fall in unadjusted numbers, reporting about 260,000 fewer claims over the past week. Maryland reported a jump of 27,337.
Meanwhile, President of the Federal Reserve Bank of Minneapolis, Neel Kashkari, estimated that the actual unemployment rate in the United States stands between 23% and 24%, insisting that official reports are likely showing lower numbers as many people are not actively looking for work.
Rebound in June?
According to Ian Shepherdson, chief economist at Pantheon Macroeconomics, at the present speed, the week claims numbers should go down beneath one million by mid-June.
He said:
“We’re very hopeful that June will see the beginnings of a rebound as states begin to reopen.”
The advance number of actual initial claims under state programs, unadjusted, amounted to 2,849,090 in the week that ended Saturday, representing a fall of 646,613 (or -18.5%) from the previous week. Still, continuing claims, or those who have filed within at least the last 14 days and are still on the rolls, went up by 4.6 million to 22.6 million.
Paul Ashworth, chief U.S. economist at Capital Economics commented the increase in continuing claims “is a little disappointing since it suggests few people are being recalled to work.” Said. The truth is, the cutbacks connected with social distancing practices have erased all of the job achievements the economy has seen since the recovery from the Great Recession.
The latest jobless claims numbers came a day before the Labor Department releases its nonfarm payrolls report for April. Economists surveyed by Dow Jones expect a plunge of 21.5 million, possibly the worst month in U.S. history, with the unemployment rate rising to 16%.
You can read more about the impact of the COVID-19 impact on the special coronavirus news section on our website.