Nearly 900,000 claims for regular unemployment benefits were filed last week, according to the U.S. Department of Labor.
In the week ending October 10, the advance figure for seasonally adjusted initial claims was 898,000, an increase of 53,000 from the previous week’s revised level. The previous week’s level was revised up by 5,000 from 840,000 to 845,000. The 4-week moving average was 866,250, an increase of 8,000 from the previous week’s revised average. The previous week’s average was revised up by 1,250 from 857,000 to 858,250.
The advance seasonally adjusted insured unemployment rate was 6.8 percent for the week ending October 3, a decrease of 0.9 percentage point from the previous week’s revised rate. The previous week’s rate was revised up by 0.2 from 7.5 to 7.7 percent. The advance number for seasonally adjusted insured unemployment during the week ending October 3 was 10,018,000, a decrease of 1,165,000 from the previous week’s revised level. The previous week’s level was revised up 207,000 from 10,976,000 to 11,183,000. The 4-week moving average was 11,481,750, a decrease of 682,250 from the previous week’s revised average. The previous week’s average was revised up by 51,750 from 12,112,250 to 12,164,000.
Again, the chart shows the persistent claims plateau.
Again, there’s the California asterisk.
In response to recommendations resulting from an internal review of state operations, the state of California has announced a two week pause in its processing of initial claims for unemployment insurance benefits. The state will use this time to reduce its claims processing backlog and implement fraud prevention technology. Recognizing that the pause will likely result in significant week to week swings in initial claims for California and the nation unrelated to any changes in economic conditions, California’s initial claims published in the UI Claims News Release will reflect the level reported during the last week prior to the pause. Upon completion of the pause and the post-pause processing, the state will submit revised reports to reflect claims in the week during which they were filed.
With smore than 10% of the nation’s population, California’s numbers can be expected to move the national numbers, perhaps more than a bit if the state’s experience differs substantially from the overall national experience..
Thursday’s report from the Labor Department shows that the job market remans fragile, and it coincides with other recent data that have signaled a slowdown in hiring. The economy is still roughly 10.7 million jobs short of recovering all the 22 million jobs that were lost when the pandemic struck in early spring…
The recession has disproportionately hurt in-person service industries, especially restaurants, hotels, travel companies and entertainment venues. The damage to those industries has left millions of people unemployed, likely for an extended period until they are either finally recalled to their previous jobs or switch to new careers.
The government’s report Thursday said the number of people who are continuing to receive unemployment benefits dropped 1.2 million to 10 million. The decline signals that many of the unemployed are being recalled to their old jobs. But it also reflects the fact that potentially even more people have used up their regular state benefits — which usually expire after six months — and have transitioned to extended benefit programs that last an additional three months.
And the AP points out that lack of additional federal relief will likely affect consumption spending in the coming weeks.
The end of federal aid for the unemployed will likely force many of the jobless to sharply cut their spending, thereby weakening the economy. The full impact may have been delayed, though, by the fact that most of the federal aid was saved or was used to pare debt, according to research by the Federal Reserve Bank of New York.
According to the New York Fed, at the end of June nearly one-quarter of jobless aid payments had been saved. Nearly half were used to pay down debt. Just 28% of the money was spent.
The state Employment Security Department will release data on Washington’s claims later today.