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The Labor Department announced on Thursday that weekly unemployment claims in the U.S. dropped from 227,000 to 184,000, the lowest since Sept. 6, 1969, which were a reported 182,000. This is a far lower count than what had been predicted. Economists surveyed by Dow Jones expected to see new claims lower slightly to 211,000. This could mark a turnaround for a job market that was decimated amidst the pandemic.
It is believed that seasonal volatility is a contributing factor to the lowest level of unemployment claims in 52 years. Stephen Stanley, chief economist at Amherst Pierpont Securities, says that the labor department adjusts the numbers to reflect job market fluctuations around the holidays. Before seasonal adjustments, claims actually rose by nearly 64,000 to almost 281,000.
Still, Stanley believes the downward trend reflects the strengthening labor market as the economy recovers from the pandemic. He said in a research note that “the underlying trend remains downward and should be lower than it was prior to the pandemic … the unfilled demand for workers is much larger than it was then and layoffs appear to be noticeably lower.”
Pre-pandemic claims in 2019 averaged 218,000 a week. Peak pandemic claims in 2020 were roughly 6.1 million new claims in a single week. Since then, the number of weekly claims has gradually decreased to now hitting a record low in decades. The U.S. has also regained nearly 18.5 million jobs since April of last year.
Despite this good news, there is much more work to be done. Employers posted a near-record 11 million job openings in October; a month which saw 4.2 million people quit their jobs following a record of 4.4 million in September. The economy is still 3.9 million jobs short of where it stood in February 2020 just before the pandemic hit.
With the massive government aid and the rollout of vaccines aimed at helping revive the economy and the job market, the number of unemployment claims should continue to decrease.
What do you think of the recent unemployment claims in the U.S.? Let us know down in the comments.
This article originally published on GREY Journal.