The number of people applying for jobless aid is expected to have held at a historically high level last week, as layoffs remain elevated despite signs of a broader labor-market recovery.
Weekly initial claims for jobless benefits through regular state programs have stabilized just below 900,000 in recent weeks. That is well down from the 6.9 million weekly claims filed in late March but remained above the highest level before this year in records going back to the 1960s. Similarly, the number of workers receiving unemployment payments has declined this summer but remained well above pre-coronavirus pandemic levels.
The decreased number of unemployment rolls covered by regular state programs—which covers most workers—indicates some laid off workers are finding new employment or are being recalled. However, the decrease could also reflect benefits that are expiring for others. Many states offer up to six months in jobless benefits, so those who applied in March could be losing those benefits and would need to shift to other emergency programs.
“Unemployment is down from its peak, but I remain concerned,” said Bradley Hardy, an economist at American University in Washington, D.C. He added that part-time workers and those with jobs tied to still sparsely populated downtowns, malls and universities are particularly vulnerable. “If you have the flu season combined with a potential second wave, I’d be concerned about forecasting continued improvement in the job market.”
The labor market has partially recovered from the severe downturn caused by the coronavirus pandemic and related shutdowns of businesses. Employers through August have replaced about 11 million jobs of the 22 million shed in March and April at the beginning of the pandemic. But the pace of hiring slowed later in the summer, and layoffs have remained persistent.