The Labor Department stated that the number of first-time unemployment claimants rose by 870,000 for the week that ended on September 19, signaling that the US economy is not recovering fast enough from the crippling coronavirus pandemic. Economic analysts had speculated that the number of initial jobless claims for the week under consideration would be 850,000 given that the week previous to this was 860,000. But this was obviously not the case.
“The jobless claims data paint a picture of a labor market recovery that’s struggling to maintain momentum,” said Nancy Vanden Houten, lead US economist at Oxford Economics.
Peter Boockvar, chief investment officer at Bleakley Advisory Group, identified that the expiration of the weekly $600 given to coronavirus-related job losses comes up this summer. He noted that some people are more encouraged to go to work without minding the additional $600 per week given to them while others have not been successful with their job search this time around.
“Bottom line, we have a mix of people going back to work because they are now greater incentivized to do so without the extra $600 per week and those that are still challenged in finding a job that matches their skills in this unfortunate pandemic landscape,” Boockvar said.
The Labor Department disclosed that the highest week-over-week increases in first-time unemployment claimants occurred in New York in Georgia by over 9,000 and more than 6,000 last week respectively.
Given the bleak shape of the economy, the Federal Reserve and top economists contend that a new monetary stimulus package would be needed to boost the economy, but lawmakers seem to think otherwise and progressively dally with the issue. Fed Chairman Jerome Powell urged lawmakers to consider releasing more financial support to people so that the economy can remain on an even keel, but it is hard to claim that they even heard him at all.
“We’ve come a long way pretty quickly, and that’s great,” Powell urged. “But there’s a long way to go. So I just would say we need to stay with it, all of us. The recovery will go faster if there’s support coming both from Congress and from the Fed.”
In the week that ended by September 12, the number of people who continued with collecting joblessness claims for a minimum of two straight weeks reduced by 167,000 to 12.58 million. But as it stands today, the data for people who continue to collect claims had been delayed by one week.