Unemployment claims are worse than expected as pandemic-related registrations increase
Initial unemployment insurance claims last week totaled 793,000 as declining Covid-19 cases barely relieved the job market.
The total for the week ending February 6 was above the forecast of 760,000 forecast by economists polled by Dow Jones, but a slight decrease from the previous week’s revised upward of 812,000.
The pandemic has put the labor market in a long struggle to return to its previous levels. The number of non-farm workers rose by just 49,000 in January, while the unemployment rate fell to 6.3%, largely due to a decline in the labor force.
Persistent claims, which are a week behind the weekly loss count, also fell, falling 145,000 to 4.54 million.
However, the total number of beneficiaries across the program rose to 20.44 million, due to an increase in claims for two pandemic compensation programs, one for those who would otherwise not receive benefits and the other for those whose regular benefits have expired are.
The number of participants in the special pandemic programs rose by nearly 2.7 million in the week ended January 23.
The programs had expired on December 26, but were renewed by Congress for 2021. Paperwork issues resulted in delays in a number of states including Ohio, with more than 90,000 applications received in the past week, according to unmatched data. The new legislation offers benefits of $ 300 above what recipients would normally get.
California also saw a significant increase with 23,588 new claims. Several states saw sharp declines including Florida (-51,519), New York (-19,824), and Maryland (-19,736).
There are more than 10 million unemployed, although more than 12.5 million jobs have been reclaimed since the depths of the pandemic in March and April 2020.
Federal Reserve Chairman Jerome Powell said Wednesday the employment picture was “far off” and the central bank was determined to keep interest rates low until much more progress is made.