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.
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.
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%
Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It may not have been reviewed, commissioned or otherwise endorsed by any of our network partners.
This article originally appeared on MagnifyMoney.com
Another 1.18 million Americans filed new unemployment claims last week (1.4 million expected) https://t.co/OTx4T687Nw pic.twitter.com/oTadCz2bBr
— Yahoo Finance (@YahooFinance) August 6, 2020
when adding the pandemic unemployment assistance (for gig, contract workers), about 1.6 million Americans (not seasonally-adjusted) turned to unemployment the week ended August 1.
— Brian Cheung (@bcheungz) August 6, 2020
Three-week trend continuing to tilt down https://t.co/hfxhOE5w2G pic.twitter.com/4HbkVfxp9E