WASHINGTON (AP) – The number of people seeking unemployment assistance soared last week to 965,000, the highest since late August and a sign that the resurgent virus has likely increased layoffs.
The latest figures for unemployment claims, published on Thursday by the Department of Labor, remain at levels never seen before the virus has arrived. Prior to the pandemic, weekly requests were approximately 225,000. They rose to nearly 7 million last spring, after the shutdowns occurred nationwide. Applications were reduced during the summer, but since September have remained above 700,000.
The high rate of layoffs coincides with an economy that has faltered as consumers have avoided traveling, shopping and eating away from home in the face of the high number of viral cases. More than 4,300 deaths were recorded on Tuesday, another historic record. Stops at restaurants, bars, and other places where people gather in California, New York, and other states have probably forced layoffs.
Some states and cities are resisting the shutdowns, partly for fear of economic consequences, but increasing the risk of new infections. Minnesota allowed to resume food in person this week. Michigan is about to do the same. Some Kansas City bars and restaurants extend their hours.
Economists say that once coronavirus vaccines are more widely distributed, a broader recovery should be consolidated during the second half of the year. The incoming Biden administration, along with a House and Senate now fully led by Democrats, is also expected to push for more bailout aid and spending measures that could accelerate growth.
However, many analysts are also concerned that with millions of Americans still unemployed and up to one in six small businesses leaving the business, people who have been hardest hit by the recession are unlikely to benefit from it. ‘a recovery soon.
“While the outlook for the economy at the end of 2021 is optimistic, the recovery in the labor market has taken a step back,” said Nancy Vanden Houten, an economist at Oxford Economics, “and we expect claims to remain high.” with the risk that they will rise from last week ‘s levels “.
Last week’s aid applications could have been high in part because state employment offices had been closed over the holidays, forcing some unemployed people to wait until last week to present the sun. · Licitud. The addition of a $ 300-a-week federal unemployment benefit, as part of a rescue aid package enacted late last month, could also have encouraged more people to apply, he said. dir Vanden Houten.
In addition to last week’s first unemployment benefit applications, the government said Thursday that 5.3 million Americans continue to receive state unemployment benefits, up from 5.1 million the previous week. . It suggests that there are fewer unemployed people finding work.
Approximately 11.6 million people received unemployment benefits from two federal programs the week ended Dec. 26, the last period for which data is available. One of these programs provides broad benefits to people who have exhausted their state aid. The other provides benefits to the self-employed and hired.
These two programs had expired by the end of December. They were renewed late, until mid-March, in the $ 900 billion bailout package that Congress passed and President Donald Trump signed the law. This legislation also included $ 600 relief checks for most adults and an additional unemployment benefit payment of $ 300 a week. Congress Democrats are in favor of raising checks to $ 2,000 and extending federal aid beyond March, as President-elect Joe Biden does.
The weakness of the U.S. labor market was clearly painful in the December employment report the government issued last week. Employers stopped working for the first time since April, as the pandemic hardened consumers and businesses.
The figures also represented a strongly unequal labor market: Last month’s losses were concentrated among restaurants, bars, hotels and entertainment venues, places that offer face-to-face services that some governments have restricted or that consumers are avoiding. Educational services, mainly colleges and universities, also cut workers in December. So did film and music studios.
Most other large industries, however, reported labor gains. Many economists had hoped last spring that job losses would spread to more industries. Although initially all sectors of the economy laid off workers, most of them have avoided deep job cuts. Manufacturing, construction and professional services such as engineering and architecture, for example, added jobs in December.
At the same time, many companies seem reluctant to sharply increase hiring. A government report showed on Tuesday that employers were announcing fewer open jobs in November than in October. The decline, though small, was widespread in most industries. Even now, the nation has nearly 10 million fewer jobs than before the pandemic plunged the economy into a deep recession nearly a year ago, after having regained only 56% of jobs lost in the spring.