US unemployment claims dip below 1m for first time in 20 weeks | Business

US unemployment claims dip below 1m for first time in 20 weeks | Business

The number of Americans who filed new claims for unemployment benefits last week dipped below 1 million for the first time in 20 weeks, but signs of the coronavirus pandemic’s devastating impact on the US jobs market remain.

The latest figures from the labor department showed 963,000 people filing claims after 20 weeks of claims above 1m. Claims still remain historically high. Before the pandemic, claims were averaging about 200,000 a week and the previous record for claims was 695,000, set in 1982.

Unemployment claims graph

The latest figures come as millions of unemployed Americans are dealing with the end of a $600 boost to their unemployment benefits.

The extra payments, agreed by Congress in March, ended last month and Congress remains deadlocked over an extension. Donald Trump has signed an executive order that would boost payments by $400 a week, but the order could take months to implement and cash-strapped states – some of which are already out of money – are expected to contribute to the plan.

The US jobs market has picked up in the last two months. In July, the US added 1.8m jobs and the unemployment rate fell to 10.2% from 11.1%. The gains were largely in restaurants, bars and the leisure sector, which had furloughed millions of workers when the virus struck.

But with states and local governments rapidly running out of cash, economists are expecting a new wave of layoffs as the pandemic continues unabated. Last month’s jobs report showed little growth outside the sectors hit hardest in the wave of quarantine closures.

“Jobs for more-skilled workers in business/professional services are making little headway overall and are declining in computer services, management and advertising,” Sophia Koropeckyj, economist at Moody’s Analytics, wrote in an investor note. “These are the secondary effects of the stressed economy.”’

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