(Bloomberg) – Unemployment claims in the United States fell for the fourth week in a row, a trend that suggests labor market conditions are improving as the economy recovers.
Initial claims for unemployment benefits fell by 29,000 to 348,000 in the week ended Aug. 14, a low during the pandemic, according to data released Thursday by the Labor Department. Economists surveyed by Bloomberg projected a decline to 364,000.
Continued claims for state benefits fell to 2.8 million in the week ending Aug. 7, also the lowest level since the pandemic began.
The decline in initial applications points to stronger business activity and fewer layoffs as the economy improves. Nonetheless, a spike in initial applications in the coming weeks could point to labor market weakness as the delta variant of covid-19 spreads.
Some states and cities have reintroduced the requirement to wear a mask in recent weeks in response to variants of the coronavirus, while companies have delayed their return-to-office plans. But so far there is little evidence to suggest that the delta variant has led to layoffs, especially since no restrictions have been placed on restaurants, bars and entertainment venues.
Texas and Illinois saw the biggest drops in initial applications last week. Virginia posted the largest increase, followed by New Mexico and California.
More than 20 governors prematurely terminated federal unemployment programs – including an additional $ 300 weekly pay – implemented during the pandemic, hoping that the removal of the enhanced payments will incentivize workers to seek work. Lawsuits in some of those states challenging the governors’ legal authority to end the aid could reinstate suspended benefits until they officially expire in early September.
Initial application figures coincide with the survey week for the Department of Labor’s monthly employment report
Continuing requests for all programs decreased to 11.7 million in the week ending July 31. That compares with a high of around 32.8 million in June 2020.
