More on yesterday’s increase in unemployment claims, plus other mixed economic news.

Yesterdays boost in UI claims in Washington merits additional comment, so we turn to Seattle Times business reporter Paul Roberts’s coverage. He writes,

Washington’s surge in claims, which rose to the highest level since the week ending Aug. 1, comes amid signs that the state’s economic recovery may be slowing.

On Wednesday, the ESD reported that the state added just 2,400 jobs in September, down from a revised 69,000 in August and 62,400 in July. The state’s unemployment rate for September was 7.8%, down from a revised rate of 8.4% in August.

Some of the state’s surge in jobless claims reflects the usual end-of-summer dip in seasonal employment, said Anneliese Vance-Sherman, an ESD regional labor economist who covers the Seattle area. Historically, initial jobless claims start rising in October and peak in December, she said.

But she and other economists pointed to several pandemic-related trends that could be contributing to the uptick in claims as well as to slowing job growth.

He references a drop in government hiring, most likely tied to education. Then this:

Consumer spending still hasn’t returned to pre-pandemic levels. As of Sept. 27, daily spending by Washington residents during the pandemic has been nearly 2% lower than it was on March 1, shortly before government stay-at-home orders went into effect, according to a “recovery tracker” developed by Harvard University economist Raj Chetty and colleagues.

That dip is likely feeding employers’ reluctance to make new hires or retain current staff, economists say.

Spending held up surprisingly well over the summer, largely as a result of federal relief spending, including elevated UI benefits. Loss of that assistance may lead to an autumn of belt-tightening. And, with the economy still constrained by social distancing and consumer uncertainty, opportunities to spend are fewer.

Consumer spending may stay low for months, in part because of health-related restrictions that limit capacity in businesses as well as consumers’ fears of COVID-19, said Jacob Vigdor, an economist and professor of public policy at the University of Washington.

“For the next several months, it’s clear that many of the traditional things that people do to spend money — go out to eat, go to the movies, go to sporting events, go to concerts or theatrical productions — won’t be viable,” Vigdor said. “Even in states that have relaxed lockdowns much more rapidly, the reluctance of consumers to engage in their traditional habits has made it difficult for these businesses to break even.”

Still, there was some good news in today’s report that retail sales nationally have risen for five consecutive months. (Report here.)

Retail sales rose strongly in September, the fifth consecutive month of growth, as Americans spent more on clothing, cars and sporting goods.

The U.S. Commerce Department said Friday that retail sales jumped 1.9% last month. That’s much better than the 0.8% rise economists expected. And it’s up from an increase of 0.6% in August.

Again, uncertainty prevails while the pandemic persists.