Weekly Jobless Claims Hold Steady as Another 1.3 Million Americans File for Unemployment
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Initial jobless claims fell slightly last week to 1.3 million.
Last week saw the fewest new petitions filed since the pandemic ramped up in March, but the 1.3 million claims represents only a slight decline from the prior week’s read of 1.31 million claims. (Economists had predicted claims would total around 1.25 million.)
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This marked the 16th straight week that initial petitions have totaled at least 1 million. In addition, continuing claims — which paints a broader picture of joblessness in the country and lags jobless data by one week — totaled 17.33 million for the week of July 4, down from 18.06 million the prior week.
The leveling off comes as COVID-19 cases continue to climb in some states, such as Arizona, Florida, Texas and California. The latter reversed course on its reopening process this week, shuttering nonessential offices as well as indoor spaces including malls, restaurants and movie theaters. Meanwhile, Florida is facing an ICU bed shortage, while Arizona has set a record for number of beds in use.
The past two months have indicated that a turnaround could be on the horizon: For the month of June, the Bureau of Labor Statistics reported that American employers gained 4.8 million jobs, while the unemployment rate fell to 11.1%. (Economists had forecast an addition of 2.9 million nonfarm payrolls and a jobless rate of 12.4%.) It followed an unexpectedly upbeat May’s jobs report, which showed the largest single-month employment surge in U.S. history since at least 1939.
However, renewed lockdowns could pose a significant threat to the country’s economic recovery, as new claims were the highest in Florida, Georgia and California — three of the states seeing an uptick in COVID-19 cases.
Over the past several months, industries across the board — particularly the retail sector — have been hit hard by the outbreak.
Many nonessential employers moved to terminate or furlough their workers to preserve cash and keep their businesses afloat, along with other steps such as cutting executive pay and tapping revolving credit lines. What’s more, numerous retail players — among them boldface names such as JCPenney, J.Crew and Neiman Marcus — have filed for Chapter 11 bankruptcy since the pandemic began. Several retail companies remain on bankruptcy watchlist, including Ann Taylor parent Ascena Retail Group and Men’s Wearhouse parent Tailored Brands.
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