One million Americans file for jobless benefits as economy sinks

The number of Americans who filed for unemployment benefits for the first time came in above 1 million for the 22nd time in 23 weeks as the economy struggles to recover from the coronavirus pandemic. The Labor Department said Thursday that the number of seasonally adjusted initial claims for unemployment insurance for the week ending Aug. 22 came in at 1,006,000, falling 98,000 from the previous week, but still over one million.

Claims for Pandemic Unemployment Assistance, a program that covers those who don’t qualify for traditional unemployment insurance, also rose to 607,806 last week, a gain of 82,820. “Continuing claims continue to drop, but still indicate a highly stressed labor market,” said Jamie Cox, managing partner at Harris Financial Group in Virginia, reports CNBC. “Even a 1 million person drop in the total number unemployed isn’t enough — there is a lot of work to be done because 14 million people are still receiving UI assistance of some kind.”

Continuing claims are claims that cover those people receiving unemployment benefits for at least two straight weeks. Those claims dropped by 223,000 to 14.535 million for the week ending Aug. 15. Reuters notes that new coronavirus cases have started to decline, partially due to less testing, but with schools reopening, hot-spots remain, especially on college campuses that opened for in-person learning. However, with any new fiscal stimulus still questionable, the economy’s recovery from the pandemic is slowing.

There is no doubt that the federal government’s financial support and the reopening of many businesses in May helped to pull down claims for unemployment benefits. But with the weekly unemployment supplement expiring in July, the labor market has slowed. Many economists are saying it has become critically important that Congress approve a new coronavirus stimulus package. “Economists across the ideological spectrum have warned lawmakers that millions of Americans could be plunged into hunger, homelessness and bankruptcy without further support for jobless benefits,” according to The Hill.

Source: DJ