The number of Americans applying for state unemployment benefits last week rose for the first time since the beginning of October, indicating that layoffs are still elevated as a surge in coronavirus cases threatens to derail the economy's recovery.
The latest jobless claims figures from the Labor Department, which cover the week ending Nov. 14, show that 742,000 workers sought aid last week, about four times the pre-crisis level. Still, it's well below the peak of nearly 7 million in late March, when states first implemented lockdown measures to curb the spread of COVID-19.
It's a slight uptick from last week's revised figure of 711,000 and well above the 707,000 new claims forecast by Refinitiv economists.
"The headline here is concerning, with an increase of 31,000 to 742,000 in the number of new claims in the traditional programs administered by states," said Mark Hamrick, Bankrate.com's senior economic analyst. "That combined with the increase in claims under the Pandemic Unemployment Assistance program puts us at more than a million new claims."
Close to 67 million Americans ‒ roughly 40% of the nation's labor force ‒have applied for aid since the coronavirus lockdowns began in mid-March.
The number of people who are continuing to receive unemployment benefits fell to 6.37 million, a decline of about 429,000 from the previous week. The decline suggests that employers are calling their workers back.
Still, some of the drop in so-called continuing claims may represent workers who have used up the maximum number of payments available through state unemployment programs (typically about six months) and are now receiving benefits through a separate federal program that extends the aid by 13 weeks. Congress created the extra federal benefits earlier this year with the passage of the CARES Act.
There are still roughly 10.1 million more out-of-work Americans than there were in February, before the pandemic hit.
The report comes as newly confirmed daily infections in the U.S. have surged 80% over the past two weeks to the highest levels on record. More states and cities are issuing new lockdown measures, including restricting indoor dining, closing gyms, reducing the hours or capacity of bars and other businesses and limiting the size of indoor gatherings.
"After a strong recovery after the steep downturn of March and April, the economy faces heightened risk as we wait for delivery of reportedly effective vaccines providing us reason for real hope," Hamrick said.