Number: The number of applicants for U.S. unemployment benefits reached a two-month high in late September due to another big increase in California. Yet new demands have fallen in most other states, a sign that the labor market is still quite healthy despite the Delta variant.
In the seven days ending Sept. 25, New Unemployment Claims paid by states increased by 11,000 to 362,000, the government said Thursday.
Economists surveyed by The Wall Street Journal estimated that the new claims would add up to a total of 330,000.
At least 6.5 million Americans lost their unemployment benefits in early September when a federal-relief program was put in place during the epidemic.
Although it was already known that millions of people had been isolated, the latest estimate of the government’s new unemployment claim was to include official numbers.
Even before the end of the federal benefits, new unemployment claims were declining for months, reflecting the reluctance of employers and businessmen to fire someone in the light of a large labor shortage.
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Most of those who have lost benefits are likely to rejoin the workforce next month and it will be easier for companies to hire. Lack of labor is one of the major obstacles to rapid economic recovery from the coronavirus.
Larger image: The economy is still growing at a slightly slower pace than it was a few months ago. The emergence of the coronavirus delta variant briefly pushed it, but growth was largely stable.
Read: Half of all small businesses do not find enough staff to fill open jobs
If more people return to the workforce, the economy could expand faster, but millions of Americans are still reluctant to return to work with many companies offering higher wages and benefits.
The loss of additional unemployment benefits can also affect consumer spending and the economy in the short term.
Original details: New jobless claims rose nearly 18,000 to 86,792 in California last week, based on an disproportionate number. Just three weeks ago, the state made less than 52,000 new claims.
The state is still working through a large backlog that has not yet been processed. California was also hit fairly by the delta, although cases are now declining.
Michigan, another state where the delta case has increased, was the only other state where new unemployment claims were reported on a large scale.
Another 355 states saw new unemployment claims last week.
The number of people already receiving state unemployment benefits has dropped by 18,000 to 2.8 million. These so-called continued claims are less than epidemic.
In all, as of September 11, about 5 million people are receiving unemployment benefits through separate state or federal programs. The previous week it was 11. million million.
Yet 2.1 million of those 5 million claims were filed through federal programs, but it’s not clear which of them will be paid.
The federal program provides additional benefits to all unemployed workers, including millions of self-employed who have never been eligible for compensation in the past.
What are they saying?
“Over the past few weeks, demands in California have been consistently higher than in the other 49 states,” noted Thomas Simmons, a money market economist at Jefferies LLC. “It’s certainly possible that California’s higher economic factors are in lower trend than the other 49 states, but that seems unlikely.”
“Alternatively, California’s claims could be higher due to backlog processing or even fraud,” he added. “At the moment, it’s hard to say.”
Market Response: Dow Jones Industrial Average DJIA,
And S&P 500 SPX,
Trade rose on Thursday.