Though nowhere near pre-pandemic numbers, jobless claims are dropping. California leads states in largest decline in decreases.
The total number of new weekly unemployment insurance claims fell below the 1 million mark for the first time since March, according to data released by the U.S. Department of Labor.
Initial jobless claims for the week ending August 8 totaled 963,000, down from an upwardly revised 1.19 million one week earlier. Continuing claims for the week ending August 1 totaled 15.48 million, down from 16.1 million in the prior week.
The largest increase in initial claims for the week ending August 1 was in Rhode Island with a relatively mild uptick of 87 new claims. The states that saw the largest decreases during that week were California (-22,610), Virginia (-19,048), Texas (-14,095), Florida (-13,176), and New Jersey (-11,489).
The new report saw the end of a 20-week streak where more than 1 million new claims were being filed on a weekly basis. Before the pandemic, weekly jobless claims were routinely below the 250,000-mark. More than 56 million people filed new unemployment claims since March 20.
The advance seasonally adjusted insured unemployment rate was 10.6% for the week ending Aug. 1. White House economic adviser Larry Kudlow greeted the news with a prediction that the unemployment rate could return to single-digit levels as early as this month, adding that third quarter growth could reach 20% or more.
“The key point that I would make is the economy is rebounding, it looks like a V-shaped recovery and the recent news now is even better than it was a month ago,” Kudlow said in a virtual appearance during a conference sponsored by the Council of the Americas.
However, Mark Hamrick, Senior Economic Analyst at Bankrate.com, told USA Today that it was still too soon to announce “mission accomplished” in regard to believing the economy was in a full-throttle recovery mode.
“What we’re really doing is recovering some of the jobs lost,” Harmick said.
A more cautiously optimistic vision came from Doug Duncan, SVP and Chief Economist at Fannie Mae.
“This morning’s unemployment insurance claims report showed the labor market is continuing its gradual improvement,” Duncan said, who warned that although “the pace of decline in claims had paused briefly, it appears to be accelerating again, an encouraging sign for the labor market recovery. However, the initial claims figure still remains above the peak value seen during the previous recession, and we note the headline number does not include an additional 489,000 claims filed under the Pandemic Unemployment Assistance program.”
Duncan added that while the level of continued claims was in decline, this figure “still remains at historically unprecedented levels and continues to indicate that while improving, the total extent of joblessness and income curtailment remains significantly elevated.”