The number of Americans applying for jobless aid ticked up last week, signaling that layoffs continue even as the overall economy slowly recovers.
Some 719,000 people applied for unemployment benefits in the week ending March 27, the Labor Department said Thursday. That's an increase of 61,000 from the previous week.
Another 237,000 people applied for Pandemic Unemployment Assistance, a federal program for the self-employed and gig workers.
Still, the overall trend is of slow improvement. This is the second week in a row that total claims were below a million since the pandemic first shut down the economy and sent unemployment skyrocketing in March 2020.
"Today's Labor Department report reveals both signs of hope as well as reminders of significant economic challenges ahead," Andrew Stettner, senior economist at the Century Foundation, said in a statement.
The four-week average dropped to 719,000, its lowest level in over a year. The average is considered a more reliable sign of the trend in jobless claims, because it strips out weekly fluctuations that may be due to things like extreme weather or technical glitches.
"Higher jobless claims in the most recent week don't detract from the strong downward trend, which will continue given the reopening of local and state economies, and the acceleration of vaccinations," Robert Frick, corporate economist at Navy Federal Credit Union, said in a note.
Last month, consumer confidence reached a post-pandemic peak. And the $1,400 checks in President Joe Biden's $1.9 trillion economic relief plan have sharply lifted consumer spending, according to Bank of America's tracking of its debit and credit cards. Spending jumped 23% in the third week of March compared with pre-pandemic levels, the bank said.
The Federal Reserve's policymakers have substantially boosted their forecast for the economy this year, anticipating growth of 6.5% for 2021, up from an estimate in December of just 4.2%. That would be the fastest rate of expansion in any year since 1984.
The total number of people receiving jobless aid fell to 18.2 million as of mid-March, down 1.5 million from the prior week.
The Associated Press contributed reporting.