September 23, 2021 – The Labor Department reported that 351,000 Americans have filed new claims for state unemployment benefits. The previous week’s level was revised up by 3,000 from 332,000 to 335,000. The four-week moving average was 335,750, a decrease of 750 from the previous week’s revised average. The previous week’s average was revised up by 750 from 335,750 to 336,500. “Despite the rise, claims are still near a pandemic-era low,” said Chris Giamo, head of commercial banking at TD Bank. “For those ready to return to work following a period of displacement or unemployment, there are a record number of open jobs awaiting.”
The Federal Reserve on Wednesday struck upbeat note on the economy, paving the way to reduce its monthly bond purchases “soon” and signaling interest rate increases may follow more quickly than expected.
Job growth slowed in August, with payrolls posting their smallest gain in seven months amid a stalling in hiring in the high contact leisure and hospitality sector as infections driven by the Delta variant of the coronavirus surged.
“Although supply constraints are expected to ease over coming months, the labor market still faces headwinds from the virus, especially if it continues to disrupt school re-openings and business activity,” Rubeela Farooqi, chief economist for High Frequency Economics, wrote in a note earlier this week. “That could have implications for labor supply and demand going forward, which in turn will impact the timing of a complete recovery in the labor market.”
In addition, pandemic-related factors are causing worker shortages, which are constraining hiring. Fed chair Jerome Powell told reporters he anticipated “more rapid gains in employment” as these factors, which include lack of affordable child care and fears contracting the virus, diminish.
During the week, 47 states reported 4,896,125 continued weekly claims for Pandemic Unemployment Assistance benefits and 47 states reported 3,644,555 continued claims for Pandemic Emergency Unemployment Compensation benefits. The highest insured unemployment rates were in Puerto Rico (4.4), District of Columbia (4.2), California (3.1), New Jersey (3.0), Illinois (2.8), Nevada (2.8), New York (2.8), Rhode Island (2.7), Hawaii (2.5), and Connecticut (2.2). The largest increases in initial claims were in Louisiana (+4,318), District of Columbia (+3,783), Arizona (+3,739), Maryland (+2,018), and Missouri (+1,658), while the largest decreases were in Illinois (-7,481), California (-5,950), Ohio (-4,665), Texas (-3,635), and Virginia (-2,357).
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. “Employers are ready to bring their workers back as restrictions lift and America gets ready to work,” said Becky Frankiewicz ManpowerGroup president, North America. “Yet childcare challenges, health concerns and competition mean demand still outstrips supply which is dampening the ‘big return’ of the American workforce. It’s a worker’s market and employees are acting like consumers in how they are consuming work – seeking flexibility, competitive pay and fast decisions.” Now is the time for employers to get creative to attract talent, she said, “and to hold onto the workers they have with both hands.”
According to the study, payroll gains were expected in all 12 U.S. industry sectors: leisure and hospitality (+41 percent), wholesale and retail trade (+29 percent), education and health services (+27 percent), transportation & utilities (+26 percent), durable goods manufacturing (+25 percent), nondurable goods manufacturing (+25 percent), professional and business services (+21 percent), construction (+19 percent), information (+18 percent), other services (+16 percent), financial activities (+15 percent) and government (+15 percent).
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor – Hunt Scanlon Media