Jobless Claims Come in at Pre-Pandemic Levels

The number of Americans applying for unemployment benefits continue to fall to pre-pandemic levels, another sign that the job market is recovering from last year’s sharp coronavirus downturn. Let’s take a closer look!  

December 9, 2021 – The Labor Department reported that 184,000 Americans have filed new claims for state unemployment benefits, a decrease of 43,000 from the previous week’s revised level. This is the lowest level for initial claims since September 6, 1969 when it was 182,000. The previous week’s level was revised up by 5,000 from 222,000 to 227,000. The four-week moving average was 218,750, a decrease of 21,250 from the previous week’s revised average. This is the lowest level for this average since March 7, 2020 when it was 215,250. The previous week’s average was revised up by 1,250 from 238,750 to 240,000.

Last week, the Labor Department reported that employment rose by 210,000 in November as the U.S. unemployment rate fell to 4.2 percent. This is well below the half-million gain that had been expected. The number of unemployed persons fell by 542,000 to 6.9 million. Notable job gains occurred in professional and business services, transportation and warehousing, construction, and manufacturing. Employment in retail trade declined over the month. Among the major worker groups, the unemployment rates for adult men (4.0 percent), adult women (4.0 percent), Whites (3.7 percent), Blacks (6.7 percent), and Hispanics (5.2 percent) declined in November. The jobless rates for teenagers (11.2 percent) and Asians (3.8 percent)showed little change over the month.

“Employers need to continue to be laser-focused on retention, as well as recruitment, given American workers are resigning at record rates,” said Mike Smith, global CEO of Randstad Sourceright. “Flexibility has become the focus for employees, and we are seeing smart organizations respond swiftly by creating innovative ways to deliver a more flexible work environment, including the growing use of contingent, part-time and remote talent to fill high in-demand skill gaps and address employee expectations.”

Still, economists say the labor market has a long way to go before reaching normalcy after national reads on employment over the last three months have mostly failed to impress them. “Overall, the labor market is on a gradual path of improvement. However, shortages — evident in the high level of job openings, which continue to outpace the number of unemployed individuals, — are preventing a stronger recovery,” wrote Rubeela Farooqi, chief economist for High Frequency Economics, in a note.

“Our expectation remains that as the cushion from savings continues to diminish, and assuming the virus does not disrupt activity once again, supply constraints will ease,” Ms. Farooqi added. “That will not only provide a boost to job growth but will also help lift participation and take pressure off wages.”

Pandemic Unemployment Assistance Benefits

During the week, 42 states reported 124,536 continued weekly claims for Pandemic Unemployment Assistance benefits and 42 states reported 112,728 continued claims for Pandemic Emergency Unemployment Compensation benefits. The highest insured unemployment rates were in Alaska (2.9), District of Columbia (2.8), New Jersey (2.3), Puerto Rico (2.3), California (2.1), Hawaii (1.8), Minnesota (1.8), Nevada (1.8), Illinois (1.7), and Massachusetts (1.7). The largest increases in initial claims were in North Carolina (+2,461), Wisconsin (+1,081), Ohio (+300), Connecticut (+251), and Idaho (+249), while the largest decreases were in Virginia (-6,548), California (-5,613), Texas (-5,447), Michigan (-2,640), and New Jersey (-2,371).

What’s Ahead

Employers in 32 percent of U.S. businesses surveyed expect an increase in payrolls during the next three months, while three percent expect to trim payrolls and 63 percent anticipate no change, according to the latest “Employment Outlook Survey,” released by ManpowerGroup.

“This recovery is unlike any we have seen before with hiring intent picking up much faster than after the previous economic downturn,” said Jonas Prising, ManpowerGroup chairman and CEO. “As vaccine rollouts gain momentum and lockdown restrictions ease in many markets, we’re seeing sharp increases in hiring optimism reported by employers. At the same time, some workers are hesitant to re-engage with employers as factors including health concerns and childcare challenges continue. Continued talent shortages mean many businesses are prioritizing retaining and training workers with the skills they need to succeed as the economic recovery continues.”

Related: Major Paradigm Shifts Coming Out of the Coronavirus Crisis

Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor – Hunt Scanlon Media

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