New claims for US unemployment aid rose back above 1m, as the pace of lay-offs picked up again after easing last week.

There were 1.1m initial jobless claims on a seasonally adjusted basis last week, the US Department of Labor said on Thursday. That was higher than economists’ forecast for 925,000 claims. A week earlier, claims totalled 971,000, having slipped below 1m for the first time since the pandemic initially struck the labour market in March.

The figures also showed that applications for Pandemic Unemployment Assistance picked up versus the prior week. The federal programme, which extends benefits to the self-employed or other individuals who would not qualify for regular unemployment benefits, had 542,797 new applicants on an unadjusted basis, compared with 489,639 the week before.

The number of Americans actively collecting state jobless aid fell to 14.8m, from 15.5m earlier, for the week that ended August 8. Economists expected continuing claims to hit 15m. Continuing claims, which hit a peak of 24.9m in May, are down from a mid-July level of nearly 17m.


10.2%


Continuing unemployment benefit claims for week ended August 8

Continuing claims equalled 10.2 per cent of the workforce, down from 10.6 per cent. It was the lowest insured unemployment rate since early April, although joblessness remains historically elevated. The insured unemployment rate hit a high of 5 per cent during the 2008-09 downturn.

Weekly claims had fallen in each of the last two weeks after ticking up in July following moves by California, Texas and Florida — the three most populous US states — to reimpose curbs on businesses in hopes of stifling the spread of coronavirus. Infection rates and active hospitalisations for Covid-19 have since eased in several states that experienced outbreaks this summer, raising hopes that they have turned a corner in their fight against the virus.

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An additional $600 in weekly federal aid for the unemployed expired at the end of last month. These supplemental benefits are among the issues debated by Congress and the White House in stalled negotiations over a new stimulus bill. Donald Trump signed an executive order seeking to extend the benefit at a lower level, but the timing remains unclear. Economists have said those benefits could kick in by late August.

The Department of Labor said there were 28.1m people claiming benefits in state and federal programmes as of August 1, based on unadjusted figures that are reported on a two-week delay. This tally, which was 28.3m in the prior week, includes PUA claims and another programme under the Cares Act that extends unemployment benefits for up to 13 weeks.

Via Financial Times