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Nov. 12, 2020, 11:22 a.m. EST

U.S. jobless claims sink 48,000 during election week to pandemic low of 709,000

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Jeffry Bartash

The numbers:  The number of Americans who applied for state unemployment benefits during election week fell by 48,000 to a pandemic low of 709,000, suggesting a record outbreak in coronavirus cases has not made a big dent on the labor market.

At least not yet.

The decline was bigger than expected. Economists polled by MarketWatch had forecast initial jobless claims to fall to 731,000 in the seven days ended Nov. 7.

Another 298,154 people, however, applied for benefits through a temporary federal-relief program that expires at the end of the year, the government said Thursday.

If both state and federal claims are combined, the number of new applications for unemployment benefits has yet to fall below 1 million a week since the onset of the pandemic.

The number of people already collecting state-provided benefits, known as continuing claims, declined by 436,000 to a seasonally adjusted 6.79 million in the week ended Oct 31.

The drop in state-provided jobless benefits marks yet another pandemic low, but the decline has been partly offset by a rising number of people who have shifted into a federal program that offers extended compensation.

Federal continuing claims rose by an unadjusted 159,776 to 4.14 million in the week ended Oct. 24, the latest data available . The number of people receiving these benefits has more than tripled since August.

Read: Biden may tone down war of words with China, but the Trump tariffs aren’t going away soon

What happened: New jobless benefit claims are falling steadily, but they are still more than three times higher now than before the coronavirus struck in March. The number of new claims last week would have been an all-time record in any other week prior to the onset of the pandemic.

Altogether, the number of people receiving benefits from eight separate state and federal programs slipped by 374,179 to an unadjusted 21.16 million as of Oct. 24. It’s unclear how many people exhausted benefits or found work.

Some economists question the accuracy of the total estimate since other government data indicates unemployment is significantly lower.

Read: Consumer price rises — aka inflation — taper off in October

The big picture: Still-high unemployment is a major obstacle to a full recovery of the U.S. economy — and the latest coronavirus outbreak won’t make it any easier. The record surge in U.S. cases is causing some states to reimpose restrictions, raising worries about more business closures and job losses.

If the economy takes a turn for the worse, pressure is sure to intensify on a divided Congress to approve more federal aid for the unemployed and struggling businesses before President-election Joe Biden takes office in late January.

A prior aid package expired in July and extended jobless benefits run out on at the end of the year.

What they are saying? “This is the fourth week in a row unemployment claims have fallen, and while the pace is slow, we are seeing the jobs market clawing its way back,” said Robert Frick, corporate economist at Navy Federal Credit Union . “Still, with more than 1 million weekly claims total, there are millions of Americans each month laid off. And with COVID-19 cases hitting new daily records, the downward trend in claims could reverse.”

Market reaction: The Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA -1.03% and S&P 500 /zigman2/quotes/210599714/realtime SPX -1.44% were set to open lower in Thursday trades.

US : Dow Jones Global
-350.76 -1.03%
Volume: 0.00
Dec. 6, 2022 5:17p
-57.58 -1.44%
Volume: 0.00
Dec. 6, 2022 5:17p

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