- Jobless claims reach lowest point since pandemic began, with 684,000 new claims filed last week
- Claims remain well above pre-pandemic levels, with the labor market still missing millions of jobs lost due to COVID-19
- Federal policies aim to accelerate a return to full employment
Summary by Dirk Langeveld
Initial jobless claims fell to their lowest point since the start of the COVID-19 pandemic last week, raising hopes that the labor market may start to show more sustained recovery. However, claims remain well above pre-pandemic levels and millions of jobs lost during the pandemic have still not been recovered.
New jobless claims for the week ending March 20 totaled 684,000, according to data from the Department of Labor. This figure marked a decline of 97,000 from the previous week’s upwardly revised number of 781,000 and beat a forecast of 735,000 from Dow Jones economists.
This is the first time since the start of the COVID-19 pandemic last year, when millions of people were filing initial jobless claims, that the number has come in below 700,000. Jobless claims have remained elevated throughout the pandemic, and the latest figure is the first one to come in below the previous record high of 695,000 set in October 1982.
Continuing claims fell by 264,000 to total 3.87 million for the week ending March 13. As of March 6, 18.95 million were receiving some sort of unemployment benefit, including 13.29 million receiving benefits through two federal emergency unemployment programs.
Despite the improvement, jobless figures remain well above pre-pandemic levels. Prior to the start of the pandemic, the United States averaged just over 200,000 initial unemployment claims. Of the 22.4 million jobs lost in March and April of 2020, only about 13 million have been recovered.
Economists hope that hiring will pick up as COVID-19 vaccine distribution proceeds and business restrictions are lifted. In the most recent jobs report, the hard-hit hospitality sector accounted for most newly created positions.
A Congressional Budget Office report released last month suggests that the GDP will recover much more quickly than the labor market, which isn’t forecast to return to its pre-pandemic size until 2022 and a pre-pandemic unemployment rate until 2024. The Federal Reserve has adopted policies aimed at restoring full employment, and Treasury Secretary Janet Yellen said she hopes the recently passed American Rescue Plan might help stimulate the economy and restore full employment by next year.
The Department of Labor shows that Connecticut had the sixth highest unemployment rate in the U.S. at 4.8 percent for the week ending March 6.
