The US labor market recovery accelerated last week as fewer Americans hit the unemployment line, the Labor Department reported Thursday.
Initial jobless claims stood at 547,000, well below the Dow Jones estimate of 603,000 and a new low for the Covid-19 pandemic.
The sum represents a further decline in claims and brings the image of jobs closer to where they were before the pandemic, although there is still a long way to go.
The markets reacted little to the news. Stock futures indicated a shallow opening and government bond yields were mixed.
With Covid cases declining and more states easing business restrictions, companies are trying again to hire workers before a summer of near-normal activity is expected in the US
“This decline in unemployment claims looks good on its own, but what is really important is that it confirms that last week’s unexpected slump was no accident,” wrote Ian Shepherdson, chief economist at Pantheon Macroeconomics. “We expect further declines over the next few months as reopening continues while wage growth accelerates significantly.”
Still, around 8 million Americans work less than they did before Covid.
Thursday’s report showed that both unemployment and underemployment remain significant problems for the US economy.
Around 17.4 million Americans are still receiving benefits under various programs, even though these dates are two weeks behind the weekly number of applications. The sharp increases in those applying for pandemic program benefits added nearly half a million to the total number of recipients.
Persistent claims, a week behind the headlines, also fell, falling 34,000 to 3.67 million, a new pandemic low and another indication that conditions are thawing.
Despite the ongoing problems for workers, the advances in Covid, particularly the roughly 3 million vaccines being administered daily, have helped resolve the worst and fastest job loss in American history.
The number of unemployment claims reached an astonishing 6.2 million in the first days of the economic standstill at the beginning of April 2020, erasing the previous record of 695,000 in October 1982. Since the peak of last year, the number has tended to go down but remains stubbornly high, only falling below that pre-pandemic record last week.
Last week, the Federal Reserve’s regular measurement of business growth in its 12 districts showed difficulty finding workers.
“Hiring remained a widespread challenge, especially for low-wage or hourly workers who are reluctant
Employment growth in some cases, “reads the report known as the Beige Book.
The national unemployment rate remains at 6%, well below the pandemic high of 14.7%, but still well above the 50-year low of 3.5% shortly before the end of the pandemic.
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