The number of Americans applying for unemployment benefits plummeted last week to the lowest level in more than half a century, another sign that the U.S. job market is rebounding rapidly from last year's coronavirus recession.
Jobless claims dropped by 71,000 to 199,000, the lowest since mid-November 1969, according to the Department of Labor. The drop was much bigger than economists expected.
The four-week average of claims, which smooths out weekly ups and downs, also dropped — by 21,000 to just over 252,000, the lowest since mid-March 2020 when the pandemic slammed the economy.
Since topping 900,000 in early January, the applications have fallen steadily toward and now fallen below their prepandemic level of around 220,000 a week. Claims for jobless aid are a proxy for layoffs.
Putting the Jobs Number in Perspective
Asked what the strong jobs number means for the Biden administration, Mark Hamrick, senior economic analyst and Washington Bureau chief for Bankrate.com, tells Newsmax Finance, "The current economy is like virtually nothing else we've ever experienced, consistent with the historic and unique aspects of the pandemic. There are the realities of the economy reflected in the data, such as the tailwinds provided by the tight and strengthening job market, and the headwinds, including continuing impacts of the pandemic -- such as supply chain disruptinos, inflation, as well as limited international and business travel."
Hamrick goes on to explain that despite the conflicting economic data, both good and bad, "the economic outlook for 2022 is generally positive," even if inflation worsens. Against this backdrop, America is a nation currently polarized by politics.
"For some," the economic analyst says, "the economic data -- good or bad -- will be ignored if its strays from an already entrenched politically inspired narrative."
As for the 52-year low jobless claim figure itself, the lowest figure since 1969, Hamrick sums up his reaction to the number as, "Wow!
"It is fair to say we didn't see that coming. Getting new claims below the 200,000 level for the first time since the pandemic began is truly significant, portraying further improvement."
Just 2 Million Americans on Unemployment
Overall, 2 million Americans were collecting traditional unemployment checks the week that ended Nov. 13, down slightly from the week before.
Until Sept. 6, the federal government had supplemented state unemployment insurance programs by paying an extra payment of $300 a week and extending benefits to gig workers and to those who were out of work for six months or more. Including the federal programs, the number of Americans receiving some form of jobless aid peaked at more than 33 million in June 2020.
The job market has staged a remarkable comeback since the spring of 2020 when the coronavirus pandemic forced businesses to close or cut hours and kept many Americans at home as a health precaution. In March and April last year, employers slashed more than 22 million jobs.
But government relief checks, super-low interest rates and the rollout of vaccines combined to give consumers the confidence and financial wherewithal to start spending again. Employers, scrambling to meet an unexpected surge in demand, have made 18 million new hires since April 2020 and are expected to add another 575,000 this month. Still, the United States remains 4 million short of the jobs it had in February 2020.
Companies now complain that they can't find workers to fill job openings, a near-record 10.4 million in September. Workers, finding themselves with bargaining clout for the first time in decades, are becoming choosier about jobs; a record 4.4 million quit in September, a sign they have confidence in their ability to find something better.
- Newsmax Wires
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