Initial weekly jobless claims totaled more than 1.4 million for the week ending July 18, according to data from the Labor Department, bringing the total number of claims to more than 52 million since coronavirus-related lockdowns began in March and marking the 18th week in a row that initial claims topped 1 million.
Economists surveyed by Refinitiv expected 1.3 million new claims.
The increase in unemployment claims "is a deeply concerning sign as the $600 weekly unemployment benefits soon expire for tens of millions of unemployed Americans," Glassdoor senior economist Daniel Zhao said. "The combined effect of rising layoffs, expiring unemployment benefits and escalating coronavirus outbreaks sets up a perfect economic storm that could easily derail the weakening economy’s fledgling recovery.”
The latest data showed some optimistic indications: Continuing claims, a broader category that measures unemployed workers receiving benefits for longer than a week, came in at nearly 16.2 million for the week ending July 11, the lowest since April 11 and the first reading below 17 million since that time.
"I don’t see any breaking of the downward trend for unemployment and the upward trend for job creation," White House chief economic adviser Larry Kudlow told FOX Business, referencing the decline in continuing claims. "We’re reasonably optimistic about July.”
The previous week's total of 1.3 million initial claims was increased to 1.307 million, however, and the outlook for the labor market has been clouded as some states slow down or even reverse course on easing shelter-in-place orders after a resurgence in coronavirus infections.
“The flare-ups of the virus in the Southwest, still difficult," Kudlow said. "There are some modest signs of improvement: For example, Arizona’s flattened out considerably. Still trouble in Texas and California, and I will acknowledge large trouble in the Miami-Dade County, Florida, area."
Still, he said, he believes the U.S. remains in "a self-sustaining recovery."