- Seasonally adjusted weekly jobless claims increase to 853,000 last week, following a decrease attributed to the Thanksgiving holiday
- Higher unemployment claims, along with other economic data, fuel concerns of slowdown or even a reversal in the U.S. economic recovery
- Nearly half of unemployment beneficiaries are receiving assistance through two federal programs set to expire on Dec. 26
Seasonally adjusted first-time unemployment claims spiked to 853,000 to close last week, marking the highest total since September. The increase, along with other trends such as a disappointing November jobs report, has fueled concerns about a sharper slowdown or even a reversal in the United States economic recovery.
The tally was up from the previous week’s upwardly revised figure of 716,000 and well above the expectation among Dow Jones economists for 730,000 new claims. While the previous week’s figure marked a considerable decrease in claims, this was largely attributed to the traditional drop in claims around Thanksgiving and other major holidays.
The figures likely reflect the fallout from increasing COVID-19 cases and new business lockdowns and restrictions being put in place to try to contain the virus. The elevated number of new claims indicates that layoffs continue to be commonplace, even as the overall U.S. economy adds jobs. Continuing claims increased for the first time since August, rising 230,000 to 5.76 million.
Just over 19 million people are collecting some form of unemployment assistance, a decrease of 1.12 million. About half are on one of two federal unemployment programs set to expire on Dec. 26: Pandemic Unemployment Assistance, which provides aid for gig workers and others who do not traditionally qualify for state benefits, and Pandemic Emergency Unemployment Compensation, which provides 13 extra weeks of benefits for those who have exhausted their state benefits.
Pandemic Unemployment Assistance claims for the week ending Nov. 21 fell 313,739 to 8.6 million, while claims under Pandemic Emergency Unemployment Compensation dropped 36,140 to 614,517. A bipartisan economic stimulus bill before Congress would extend the programs and offer a supplemental $300 a week to those claiming unemployment, while a White House proposal would extend the programs but not provide supplemental benefits.
