U.S. states saw new jobless claims fall more than expected to reach a four-month low last week, as impending spring weather and more vaccine-driven business reopenings allow hiring to pick up.
The Department of Labor released its weekly report on new jobless claims on Thursday at 8:30 a.m. ET. Here were the main metrics included in the report, compared to consensus data compiled by Bloomberg:
Initial jobless claims, week ended March 6: 712,000 vs. 725,000 expected and a revised 754,000 during the prior week
Continuing claims, week ended February 27: 4.144 million vs. 4.200 million expected and a revised 4.337 million during the prior week
Initial unemployment claims held below 800,000 for a third consecutive week and improved to the lowest level since early November, following a stretch of elevated claims around the holidays earlier this year. Still, claims remain well above even the Great Recession-era high of 665,000 weekly claims in March 2009.
And new claims are more than likely to continue dropping into the spring and summer, assuming the vaccine rollout and improving COVID-19 case counts extend into the coming months. Companies like Disney (DIS) have recently discussed plans to bring back thousands of furloughed workers in the spring, as more discretionary activities like theme parks and restaurants and resorts are permitted to reopen with easing capacity constraints. And last Friday's February jobs report showed that the economy added nearly double the number of payrolls expected for the month, affirming the hiring upturn in the service sector.
"We think that the vaccine rollout and downward trend for new COVID-19 cases should allow economic activity to keep picking up over time and that this will result in a downward trend for jobless claims filings through the volatility in the weekly series,” JPMorgan economist Bruce Kasman wrote in a recent note.
By state, California saw the greatest number of initial claims filed last week at nearly 17,000 on an unadjusted basis, ending a streak of declines in new claims over the past several weeks. Ohio, which has been contending with a wave of fraud in filings for new jobless claims, saw initial claims rise by another more than 6,000 last week. However, the vast majority of states reported declines in new jobless claims, contributing to the headline improvement last week.
Continuing claims, which count the total number of Americans still receiving state unemployment benefits, also fell for for an eighth straight week last week, reaching the lowest level in nearly one year.
Outside of regular state benefits, the number of Americans claiming unemployment benefits across all programs has still remained sharply elevated, however: Some 20 million Americans were still claiming benefits across all programs as of Feb. 20, the latest date for which data is available. That marked an increase over the prior week, and included 13.8 million Americans on either Pandemic Unemployment Assistance (PUA) — the federal program offering benefits to gig workers and the self-employed who do not qualify for other programs — or Pandemic Emergency Unemployment Compensation (PEUC), which offers additional weeks of federal benefits to those who have exhausted their state benefits.
Both the PUA and PEUC are likely to be extended until Sept. 6 once President Joe Biden signs off on the latest $1.9 trillion coronavirus relief package, which could take place as soon as this week since the bill has passed both chambers of Congress. These federal benefits were set to expire on March 14, based on terms of the $900 billion stimulus package passed in December.
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Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck
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