Jobless Claims Seen Holding at High Level as Recovery Navigates Covid-19 Surge


The beleaguered U.S. labor market is absorbing a fresh wave of jobless workers, with 778,000 new unemployment claims filed in the latest week, as soaring COVID-19 hospitalizations and deaths lead to renewed restrictions on business activity.

The Department of Labor released its weekly report on initial jobless claims Thursday morning at 8:30 a.m. ET. Here are the numbers compared to what Wall Street expected, according to consensus estimates compiled by Bloomberg:

  • Initial jobless claims, the week ended Nov. 21: 778,000 vs. 730,000 expected and 742,000 during the prior week

  • Continuing claims, the week ended Nov. 14: 6.07 million vs. 6 million expected and 6.37 million during the prior week

All told, new unemployment claims have held below the 1 million watermarks for over 3 months, and remain well below the pandemic-era peak of nearly 7 million.

Although the stock market has surged to a record high, the cresting wave of coronavirus infections is throttling the jobs market, casting a shadow over economic growth as officials mull stricter social distancing protocols in key areas.

The rising COVID-19 count has led some states and localities to shutter schools and restrict nonessential businesses, all of which had just begun to reopen. Meanwhile, a range of big companies has announced layoffs in recent months.

Service industries like restaurants and bars — such as those located in California, where state officials announced would be closed for indoor service as of this week — are expected to bear the brunt of renewed lockdowns.

In recent weeks, each day has featured a soaring number of daily confirmed coronavirus diagnoses that exceed 100,000, with well over 12 million Americans now infected by the disease.

“While the economy powered through the July wave, at that time the reopening of the economy provided a powerful tailwind to growth. The economy no longer has that tailwind; instead, it now faces the headwind of increasing restrictions on activity,” JPMorgan Chase economists wrote in a research note last week.

Warning of a “grim” winter threatening economic growth prospects, the bank added that “the holiday season—from Thanksgiving through New Year’s—threatens a further increase in cases.”

Post a Comment

Previous Post Next Post