While vaccination efforts have gathered speed and restrictions
on activities have receded in many states, the US job market is showing signs
of life.
Initial claims for state unemployment benefits fell to 657,000,
a decrease of 100,000 from the previous week, the Labor Department reported. It
was the lowest weekly level of initial state claims since the pandemic upended
the economy a year ago.
On a seasonally adjusted basis, new state claims totaled
684,000.
In addition, there were 242,000 new claims for Pandemic
Unemployment Assistance, a federal program covering freelancers, part-timers
and others who do not routinely qualify for state benefits, a decrease of
43,000.
Unemployment claims have been at historically high levels for
the past year, partly because some workers have been laid off more than once.
Much of the drop was accounted for by a decline in new claims in Ohio and
Illinois, but economists said the overall trend was encouraging.
“This is definitely a positive signal and a move in the right
direction,” said Rubeela Farooqi, chief US economist for High Frequency
Economics. “We would expect to see further improvements as vaccines roll out
and restrictions are lifted.”
Between the state and federal programs, the total number of new
jobless claims was just under 900,000 after being stuck above 1 million a week.
Although the pace of vaccinations, as well as passage of a $1.9
trillion relief package this month, has lifted economists’ expectations for
growth, the labor market has lagged behind other measures of recovery.
Still, the easing of restrictions on indoor dining areas, health
clubs, movie theaters and other gathering places offers hope for the millions
of workers who were let go in the past 12 months. And the $1,400 checks going
to most Americans as part of the relief bill should help spending perk up in
the weeks ahead.
Diane Swonk, chief economist at the accounting firm Grant
Thornton, said she hoped for consistent employment gains but her optimism was
tempered by concern about the longer-term displacement of workers by the
pandemic.
“The numbers are encouraging, but no one is jumping the gun and
hiring up for what looks to be a boom this spring and summer,” she said. “There
is a reluctance to get ahead of activity.”
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