The US labour market recovery accelerated its pace last week as the number of claims fell yet again and are edging closer to pre-pandemic levels.
The number of Americans filing new claims for unemployment benefits dropped to 547k, a level not seen since March 2020, from the previous period's figure of 586k. Today's reading came in below market expectations of 617k. Continuing claims fell by 34k to 3.67 million. Also, unadjusted claims dropped to 566k last week from 623 k the week before, with the largest declines being recorded in Texas, New York, Florida and Georgia.
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Today's reading showed the lowest figure since the week of 14 March 2020 when the economy registered 256k new unemployment claims. Source: Fred
As Covid-19 cases are declining and more states ease business restrictions, companies are looking to recruit workers again before the summer season approaches across the United States. However, the number of Americans on some form of jobless benefits rose back above 17 million, which may mean that some of the unemployed, especially those who did poorly paid jobs before the pandemic, are not eager to return to work, because current unemployment benefits are higher than what they might earn. The second reason may be that despite the rapid pace of immunization in the US, many people are still afraid of going back to work due to safety concerns. In any case, these factors may contribute to a slower recovery in the labor market.
Number of Americans on jobless benefits jumps back above 17 million. Source: Bloomberg via ZeroHedge.
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