The number of Americans filing for unemployment benefits fell to its lowest level in more than half a century last week, another indicator that the labor market in the United States is quickly recovering from last year’s coronavirus recession.
The number of people filing for unemployment benefits fell by 71,000 to 199,000, the lowest level since mid-November 1969. However, the larger-than-expected reduction was mostly due to seasonal changes around the Thanksgiving break. Unadjusted claims increased by about 18,000, to nearly 259,000.
The four-week average of claims, which smoothes out weekly fluctuations, fell by 21,000 to just over 252,000, the lowest level since the pandemic hit the economy in mid-March 2020.
Since peaking at 900,000 in early January, applications have slowly decreased, eventually falling below their pre pandemic level of roughly 220,000 each week. Jobless benefits are a proxy for layoffs.
In the week ending Nov. 13, 2 million Americans received regular unemployment payments, down marginally from the week before.
In a research statement, Contingent Macro Advisors noted, “Overall, expect further volatility in headline data, although the trend continues very slowly downward.”
Until September 6, the federal government bolstered state unemployment insurance systems by paying an additional $300 per week and extended benefits to gig workers and individuals who had been unemployed for six months or longer. In June 2020, the number of Americans getting some sort of unemployment assistance, including government programs, surpassed 33 million. Since the spring of 2020, when the coronavirus epidemic drove companies to shut or reduce hours and left many Americans at home as a health precaution, the employment market has made a spectacular return. Employers cut more than 22 million jobs in March and April of last year.
Government relief checks, ultra-low borrowing rates, and the introduction of vaccinations, on the other hand, gave people the confidence and financial means to resume spending. Employers have hired 18 million new recruits since April 2020, trying to meet an unanticipated rise in demand, and are likely to add another 575,000 this month. Despite this, the United States is still 4 million jobs short of where it was in February 2020.