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New Jobless Claims Unexpectedly Sink To 52-Year Low Despite 2 Million Americans Still Receiving Unemployment Benefits


New jobless claims fell substantially last week to their lowest level in 52 years—faring much better than economists were expecting and continuing a slew of promising developments for the labor market, which has staged an encouraging comeback in recent weeks despite struggling to add back workers who lost jobs during the pandemic.

Key Facts

About 199,000 people filed initial jobless claims in the week ending November 20, down 71,000 from the previous week and the lowest level since November 1969, according to the weekly data released Thursday.

The previous week’s new claims, at the time the lowest weekly level during the pandemic, were revised up slightly to 270,000, from 268,000 originally reported.

This week’s figures came in much better than average economist expectations calling for about 260,000 new claims last week, according to Bloomberg data.

Continuing claims, known as insured unemployment, also fell to a new pandemic-era low of around 2 million, falling 60,000 from the previous week but still higher than pre-Covid levels below 1.8 million.

In an email Wednesday, Bankrate analyst Mark Hamrick called the unexpected decline “truly significant” evidence the labor market has further improved and said growth should be “above par for the foreseeable future” given low levels of layoffs, wage gains and the falling unemployment rate.

Key Background

Though the labor market has strengthened in recent weeks, the delta variant-spurred wave of Covid-19 infections this year proved troubling for its recovery, with the pace of hiring struggling despite record-high job openings. The struggles culminated with the job market’s worst month of the year in September, when the economy added back just 200,000 jobs, starkly low compared to expectations of a million additions. But as cases declined in recent weeks, new jobless claims have posted a streak of weekly improvements, and the U.S. added back a better-than-expected 531,000 jobs in October—marking the long-struggling labor market’s best monthly showing since July. “Unemployment has fallen so far this year at the fastest rate since the 1950s,” President Joe Biden said in a statement last week. “It’s a jobs recovery that has happened years faster than after the Great Recession of 2008. America is getting back to work.”

Crucial Quote

“Americans head into the heart of the holiday season with a reasonable expectation that an already tight job market will continue to tighten in the months ahead,” Hamrick said Wednesday. “Uncertainties will always be with us, and Covid’s toll on the economy is not yet fully relegated to the rearview mirror, but the hope and expectation are that the recovery should continue into 2022. And for that, Americans can be thankful.”

Further Reading

U.S. Posts Near-Record 10.4 Million Job Openings—But Here’s Why More Americans Aren’t Looking For Work (Forbes)

U.S. Economy Added 531,000 Jobs Last Month—But 7.4 Million Americans Are Still Unemployed (Forbes)

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