The number of initial jobless claims in the United States unexpectedly rises to 419,000, the highest since March | Business and Economic News


Data from the US Department of Labor shows that as of the week of July 17, the number of initial claims for unemployment benefits in regular states totaled 419,000, an increase of 51,000 from the previous week.

after Bloomberg

The unexpected increase in applications for national unemployment insurance in the United States last week was the largest increase since late March, highlighting the weekly fluctuations in the labor market that had been improved.

According to data from the Department of Labor on Thursday, as of the week of July 17, the number of initial jobless claims in the regular state program totaled 419,000, an increase of 51,000 from the previous week. A Bloomberg survey of economists estimated that there were 350,000 new applications.

In the week ending July 10, the number of people who continued to apply for state benefits fell to 3.24 million.

After the data was released, stock futures gave up gains and US Treasuries rose.

The unexpected increase in the number of first-time jobless claims reflects a large increase in four states—Michigan, Texas, Kentucky, and Missouri. Although many factors make it difficult to adjust weekly data seasonally, the rapidly spreading delta variant of COVID-19 may inject further volatility into the data in the coming months.

Ian Shepherdson, chief economist at Pantheon Macroeconomics, wrote in a report: “As the time and scope of annual restructuring shutdowns of automakers change from year to year, claims numbers continue to be affected by seasonal adjustment difficulties.”

The number of people claiming unemployment benefits for the first time is consistent with the survey period in the monthly employment report of the Ministry of Labor. Most states, including New York, Oklahoma, and Tennessee, reported unadjusted declines from the previous week.

Nearly half of all three federal unemployment relief programs created by US governors during the pandemic ended before their expiration in September, stating that supplementary assistance is hampering job growth and preventing companies from filling record vacancies.

In the week ending July 3, the number of continuous claimants for all programs decreased by 1.26 million, mainly reflecting the end of pandemic unemployment assistance and pandemic emergency unemployment compensation in certain states.

Lawsuits in some of these states challenge the governor’s legal power to terminate aid and may restore suspended benefits or keep them until the formal expiration in September.

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