Number of workers filing for jobless aid rises for third straight week to 362,000
The number of workers applying for first-time jobless aid increased for the third week in a row last week — a sign the surge in coronavirus cases is causing an uptick in layoffs.
Some 362,000 people filed initial unemployment claims, the Labor Department said Thursday. That's an increase of 11,000 from the prior week.
"Claims rose again, and now it's evident higher layoffs are a side effect of the Delta wave," Robert Frick, corporate economist at the Navy Federal Credit Union, said in a note. With coronavirus cases nationwide appearing to have peaked, he predicted unemployment claims should resume falling in mid-October.
Weekly initial claims, understood as a proxy for layoffs, have declined more or less steadily from a 2021 high of about 900,000 claims in January.
Meanwhile, America's employers have rapidly increased their hiring since they slashed 22 million jobs in March and April 2020 as the coronavirus outbreak — and the shutdowns meant to contain it — brought economic activity to a near-standstill. Since then, the economy has recovered about 17 million jobs as the rollout of vaccines has encouraged businesses to open and expand their hours and Americans to return to bars, restaurants and hotels.
But hiring, which has averaged more than 585,000 jobs a month this year, slowed to just 235,000 in August as the Delta variant disrupted the recovery. Restaurants and bars cut nearly 42,000 jobs last month as COVID-19 cases picked up — the first drop this year. Hiring is expected to pick up to more than 560,000 this month.
"Overall, the labor market is continuing to gradually move closer to pre-pandemic health. But frictions are persisting that could delay a complete recovery," Rubeela Farooqi, chief U.S. economist at High Frequency Economics, said in a report.
Altogether, 2.8 million Americans were receiving some type of jobless aid the week of September 18. Earlier this month, the federal government stopped additional aid — including $300 a week on top of traditional state benefits — that was meant to ease the economic impact of the pandemic.
