Jobless claims: Another 1.186 million Americans filed new unemployment claims last week

 The number of new unemployment insurance claims improved last week but held above 1 million yet again, as the coronavirus pandemic continues to weigh on the pace of recovery in the labor market.

Here were the main results from the Labor Department’s weekly report released Thursday morning, compared to consensus estimates compiled by Bloomberg:

  • Initial jobless claims, the week ended Aug. 1: 1.186 million vs. 1.4 million expected, and 1.435 million during the prior week

  • Continuing claims, the week ended July 25: 16.107 million vs. 16.9 million expected, and 16.951 million during the prior week

Thursday’s report reflected the twentieth straight week that new claims topped 1 million, as the pandemic forced furloughs and layoffs across the country. Since the week ended March 20, more than 55 million individuals filed for new unemployment insurance claims.

“Initial claims have remained stubbornly high and the number of individuals receiving unemployment insurance has barely declined from its peak,” Credit Suisse economist James Sweeney wrote in a note late last week.

Meanwhile, continuing unemployment insurance claims, which capture the number of individuals still receiving benefits, also fell more than expected during the week ended July 25, declining to well below 17 million. Continuing claims, reported on a one-week lag, peaked at nearly 25 million in mid-May, and remain more than double the pre-pandemic peak of 6.6 million in mid-2009.

The latest report for new weekly unemployment insurance claims covers the final week during which Americans were eligible for enhanced federal unemployment benefits as part of Congress’s original Coronavirus Aid, Relief, and Economic Security (CARES) Act passed in March. The previous $600 per week in augmented federal unemployment insurance expired at the end of July, though many workers received their last payment from the program during the prior week.

CALEXICO, CALIFORNIA - JULY 24: Faustino (R), who is currently unemployed, waits in a socially distanced line to enter a bookkeeping shop near the U.S.-Mexico border in Imperial County, which has been hard-hit by the COVID-19 pandemic, on July 24, 2020 in Calexico, California. (Photo by Mario Tama/Getty Images)

Deliberations as to the size and duration of extended benefits are still underway among lawmakers, with tens of millions of Americans caught in the lapse as the issue remains unresolved. Many economists have raised concerns that the pace of overall economic improvement – after the second quarter’s historic 32.9% annualized decline in GDP – could be jeopardized in the absence of further support for individuals.

Other recent labor market data also reflected the slowing recovery as coronavirus cases flared in some parts of the country in June and July. On Wednesday, the closely watched ADP National Employment Report showed private payrolls rose by a meager 167,000 in July. Consensus economists had expected private employers added back 1.2 million payrolls, after an upwardly revised 4.3 million additions in June. JPMorgan economist Daniel Silver said the result “reinforces our view that the economy has lost momentum in recent weeks following a period of strong growth.”

The print boded negatively for the Labor Department’s July jobs report, set for release Friday. However, the report has historically been an imprecise indicator of the “official” government-issued employment report. ADP’s initial print for May and June payroll additions each ultimately undershot the data reflected in the Labor Department’s monthly reports.

U.S. employers announced another 262,649 job cuts in July as the COVID-19 pandemic continued to weigh on demand, the latest indication that the labor market recovery is losing steam.

FILE PHOTO: People line up outside a Kentucky Career Center hoping to find assistance with their unemployment claim in Frankfort, Kentucky, U.S. June 18, 2020. REUTERS/Bryan Woolston/File Photo

The layoffs reported by global outplacement firm Challenger, Gray & Christmas on Thursday were up 54% from June.

The job cuts, the third-largest monthly total since the coronavirus pandemic began, followed data this week showing a big step-down in private payrolls in July and further contraction in employment at the manufacturing and services industries.

Hiring announcements totaled 246,507 in July, almost matching layoffs, Challenger, Gray reported.

“The downturn is far from over, especially as COVID cases rise around the country,” said Andrew Challenger, senior vice president at Challenger, Gray. “Consumers are buying fewer goods and services, businesses are closing, and bankruptcies are rising.”

July’s job cuts brought the total so far this year to 1.848 million, up 212% from the same period in 2019. The year-to-date layoffs are just 109,180 away from the record 1.957 million job cuts announced in 2001.

The weak labor market data raises the risk of a sharper slowdown in job growth in July. The Labor Department will publish its closely watched, and broader, monthly employment report on Friday. According to a Reuters survey of economists, nonfarm payrolls likely increased by 1.6 million in July, down from the record 4.8 million jobs created in June.

According to Challenger, Gray & Christmas, COVID-19 was cited as the reason for 63,517 job cuts in July. The respiratory illness has been blamed for 1.075 million layoffs so far this year. The balance of job cuts in July was attributed to market conditions, a downturn in demand, and bankruptcies.

Several retailers including J.C. Penney and Lord & Taylor have filed for bankruptcy since March. Job cuts remained concentrated at bars, restaurants, hotels, and amusement parks. The automotive sector cut 83,853 jobs. Hiring announcements totaled 246,507 in July, almost matching layoffs.

“It is clear that many job losses are now permanent, and it will be challenging for many workers to find new jobs and feel safe taking jobs that are public-facing,” said Challenger.

The expiration of the $600 boost to unemployment benefits would leave millions of Americans without a vital source of income amid a global pandemic.

As of this writing, nearly 32 million Americans are claiming unemployment insurance benefits, according to the U.S. Department of Labor. Some states — including Nevada and Hawaii — are more vulnerable with a higher percentage of residents out of work.

To find the states most affected by the expiration of the additional $600 in unemployment benefits, we analyzed earnings data and the number of workers on unemployment insurance to determine the percentage of statewide earnings provided by the coronavirus relief bill.

Methodology

To determine the states losing the most from the expiration of the additional unemployment benefits, we first calculated the total amount earned in each state from the benefits by multiplying the number of people on unemployment insurance by $600 (the value of the additional benefits). We divided this number by the total weekly earnings in the state to create a comparative statistic. We then ranked the states from highest to lowest using this figure. Data on uninsurance claims (up to July 18) comes from the Department of Labor, while data on 2019 weekly earnings comes from the Bureau of Labor Statistics.

Here are the top 25 states that will hurt the most from the expiration of unemployment benefits.

Image Credit: Julia_Sudnitskaya / iStock.

25. Oregon

Total workers: 1,921,964

Workers on unemployment insurance: 206,756

Weekly earnings of average worker: $1,036

Estimated total weekly earnings: $1,991,923,490

Additional income from $600 unemployment benefits: $124,053,600

Percent of income from additional unemployment benefits: 6.2%

Image Credit: DepositPhotos.com.

24. New Jersey

Total workers: 4,034,480

Workers on unemployment insurance: 491,296

Weekly earnings of average worker: $1,154

Estimated total weekly earnings: $4,654,176,128

Additional income from $600 unemployment benefits: $294,777,600

Percent of income from additional unemployment benefits: 6.3%

Image Credit: DepositPhotos.com.

23. Illinois

Total workers: 5,917,347

Workers on unemployment insurance: 664,763

Weekly earnings of average worker: $1,060

Estimated total weekly earnings: $6,274,754,759

Additional income from $600 unemployment benefits: $398,857,800

Percent of income from additional unemployment benefits: 6.4%

Image Credit: ibsky.

22. New Hampshire

Total workers: 657,391

Workers on unemployment insurance: 72,523

Weekly earnings of average worker: $1,038

Estimated total weekly earnings: $682,108,902

Additional income from $600 unemployment benefits: $43,513,800

Percent of income from additional unemployment benefits: 6.4%

Image Credit: DenisTangneyJr.

21. Maine

Total workers: 607,641

Workers on unemployment insurance: 60,623

Weekly earnings of average worker: $932

Estimated total weekly earnings: $566,321,412

Additional income from $600 unemployment benefits: $36,373,800

Percent of income from additional unemployment benefits: 6.4%

Image Credit: traveler1116.

20. Minnesota

Total workers: 2,868,184

Workers on unemployment insurance: 332,040

Weekly earnings of average worker: $1,075

Estimated total weekly earnings: $3,082,724,163

Additional income from $600 unemployment benefits: $199,224,000

Percent of income from additional unemployment benefits: 6.5%

Image Credit: Scruggelgreen.

19. Texas

Total workers: 12,372,188

Workers on unemployment insurance: 1,313,086

Weekly earnings of average worker: $971

Estimated total weekly earnings: $12,010,920,110

Additional income from $600 unemployment benefits: $787,851,600

Percent of income from additional unemployment benefits: 6.6%

Image Credit: DenisTangneyJr.

18. South Carolina

Total workers: 2,093,284

Workers on unemployment insurance: 201,097

Weekly earnings of average worker: $854

Estimated total weekly earnings: $1,786,827,222

Additional income from $600 unemployment benefits: $120,658,200

Percent of income from additional unemployment benefits: 6.8%

Image Credit: SeanPavonePhoto.

17. Florida

Total workers: 8,732,627

Workers on unemployment insurance: 914,801

Weekly earnings of average worker: $918

Estimated total weekly earnings: $8,020,044,637

Additional income from $600 unemployment benefits: $548,880,600

Percent of income from additional unemployment benefits: 6.8%

Image Credit: DepositPhotos.com.

16. West Virginia

Total workers: 664,212

Workers on unemployment insurance: 64,342

Weekly earnings of average worker: $835

Estimated total weekly earnings: $554,749,862

Additional income from $600 unemployment benefits: $38,605,200

Percent of income from additional unemployment benefits: 7.0%

Image Credit: ” Chayanisa Puttamata”.

15. Mississippi

Total workers: 1,110,126

Workers on unemployment insurance: 100,191

Weekly earnings of average worker: $771

Estimated total weekly earnings: $855,685,121

Additional income from $600 unemployment benefits: $60,114,600

Percent of income from additional unemployment benefits: 7.0%

Image Credit: DepositPhotos.com.

14. Massachusetts

Total workers: 3,578,753

Workers on unemployment insurance: 537,302

Weekly earnings of average worker: $1,263

Estimated total weekly earnings: $4,520,680,790

Additional income from $600 unemployment benefits: $322,381,200

Percent of income from additional unemployment benefits: 7.1%

Image Credit: DepositPhotos.com.

13. Alaska

Total workers: 308,691

Workers on unemployment insurance: 43,225

Weekly earnings of average worker: $1,140

Estimated total weekly earnings: $352,031,216

Additional income from $600 unemployment benefits: $25,935,000

Percent of income from additional unemployment benefits: 7.4%

Image Credit: DepositPhotos.com.

12. Rhode Island

Total workers: 474,428

Workers on unemployment insurance: 65,377

Weekly earnings of average worker: $1,100

Estimated total weekly earnings: $522,060,571

Additional income from $600 unemployment benefits: $39,226,200

Percent of income from additional unemployment benefits: 7.5%

Image Credit: iStock.

11. New Mexico

Total workers: 806,473

Workers on unemployment insurance: 92,108

Weekly earnings of average worker: $904

Estimated total weekly earnings: $729,374,181

Additional income from $600 unemployment benefits: $55,264,800

Percent of income from additional unemployment benefits: 7.6%

Image Credit: Davel5957.

10. Connecticut

Total workers: 1,652,033

Workers on unemployment insurance: 254,461

Weekly earnings of average worker: $1,199

Estimated total weekly earnings: $1,981,117,974

Additional income from $600 unemployment benefits: $152,676,600

Percent of income from additional unemployment benefits: 7.7%

Image Credit: concoll.edu.

9. Vermont

Total workers: 303,295

Workers on unemployment insurance: 38,335

Weekly earnings of average worker: $983

Estimated total weekly earnings: $298,199,644

Additional income from $600 unemployment benefits: $23,001,000

Percent of income from additional unemployment benefits: 7.7%

Image Credit: ” DonLand”.

8. New York

Total workers: 9,429,172

Workers on unemployment insurance: 1,520,832

Weekly earnings of average worker: $1,230

Estimated total weekly earnings: $11,601,653,229

Additional income from $600 unemployment benefits: $912,499,200

Percent of income from additional unemployment benefits: 7.9%

Image Credit: Eloi_Omella.

7. Pennsylvania

Total workers: 5,827,122

Workers on unemployment insurance: 815,282

Weekly earnings of average worker: $987

Estimated total weekly earnings: $5,752,534,838

Additional income from $600 unemployment benefits: $489,169,200

Percent of income from additional unemployment benefits: 8.5%

Image Credit: weaver1234.

6. California

Total workers: 17,396,834

Workers on unemployment insurance: 2,946,807

Weekly earnings of average worker: $1,179

Estimated total weekly earnings: $20,507,387,919

Additional income from $600 unemployment benefits: $1,768,084,200

Percent of income from additional unemployment benefits: 8.6%

Image Credit: Art Wager.

5. Michigan

Total workers: 4,305,848

Workers on unemployment insurance: 604,846

Weekly earnings of average worker: $977

Estimated total weekly earnings: $4,205,952,326

Additional income from $600 unemployment benefits: $362,907,600

Percent of income from additional unemployment benefits: 8.6%

Image Credit: haveseen.

4. Georgia

Total workers: 4,406,223

Workers on unemployment insurance: 792,717

Weekly earnings of average worker: $954

Estimated total weekly earnings: $4,203,536,742

Additional income from $600 unemployment benefits: $475,630,200

Percent of income from additional unemployment benefits: 11.3%

Image Credit: SeanPavonePhoto.

3. Louisiana

Total workers: 1,889,866

Workers on unemployment insurance: 312,893

Weekly earnings of average worker: $954

Estimated total weekly earnings: $1,605,630,154

Additional income from $600 unemployment benefits: $187,735,800

Percent of income from additional unemployment benefits: 11.7%

Image Credit: DepositPhotos.com.

2. Hawaii

Total workers: 620,739

Workers on unemployment insurance: 128,502

Weekly earnings of average worker: $1,056

Estimated total weekly earnings: $655,748,680

Additional income from $600 unemployment benefits: $77,101,200

Percent of income from additional unemployment benefits: 11.8%

Image Credit: DepositPhotos.com.

1. Nevada

Total workers: 1,388,109

Workers on unemployment insurance: 295,994

Weekly earnings of average worker: $908

Estimated total weekly earnings: $1,260,402,972

Additional income from $600 unemployment benefits: $177,596,400

Percent of income from additional unemployment benefits: 14.1%

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This article originally appeared on MagnifyMoney.com