Following the blowout June jobs report, market participants got another update on the state of the U.S. labor market Thursday morning with the release of the weekly initial jobless claims report.

Another 1.314 million Americans filed for unemployment benefits in the week ending July 4, below economists’ expectations for 1.375 million initial jobless claims. The prior week’s figure was revised lower to 1.41 million from the previously reported 1.43 million. Weekly jobless claims have decelerated for 14 consecutive weeks; however, nearly 50 million Americans have filed for unemployment insurance over the past four months.

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(Yahoo Finance/David Foster)

“While initial jobless claims remain historically high, at more than 1 million per week, this is a gross rather than net number. The actual number of people collecting unemployment continues to steadily decline, as shown by the move down in continuing claims,” Wells Fargo said in a note July 2.

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Closely watched continuing claims, which lag initial jobless claims data by one week, totaled 18.06 million in the week ending June 27 from 18.76 million in the prior week. Consensus expectations were for 18.75 million for the week.
“Continuing claims increased in Texas, Florida, and California [in the week ending June 27], which are all experiencing a resurgence of the virus and have begun to roll back reopening measures. In turn, we expect this week's initial jobless claims to remain roughly steady and will closely monitor continuing claims, particularly in the aforementioned states that have rolled back reopening measures,” Deutsche Bank said in a note July 2. “As we highlighted recently, the continued spread of the virus remains a significant downside risk to the outlook as about 30-50% of GDP comes from counties that have seen worsening COVID trends.”
Pandemic Unemployment Assistance (PUA) program claims, which include those who were previously ineligible for unemployment insurance such as self-employed and contracted workers, were also closely monitored in Thursday’s report.
PUA claims totaled 1,038,905 on an unadjusted basis in the week ending July 4, up from the prior week’s 996,842.
As of Thursday morning, there were 12 million COVID-19 cases and 550,000 deaths worldwide, according to Johns Hopkins data. In the U.S., there were 3 million cases and 132,000 deaths.