The number of Americans applying for state unemployment benefits unexpectedly dropped last week, falling to the lowest level since the coronavirus pandemic shut down the nation's economy in mid-March.
The latest jobless claims figures from the Labor Department, which cover the week ending Oct. 24, show that 751,000 workers sought aid last week, about four-times the pre-crisis level. More than 65 million Americans ‒ roughly 40% of the nation's labor force ‒ have sought jobless aid since the coronavirus lockdowns began in mid-March.
Jobless claims have not been this low since the week ending March 14, when 282,000 Americans filed for aid, shortly before the virus-induced crisis triggered a flood of layoffs.
Economists surveyed by Refinitiv expected 775,000 new claims.
The number of people who are continuing to receive unemployment benefits fell to 7.75 million, a decline of about 709,000 from the previous week. The decline suggests that employers are calling their workers back.
Still, some of the declines 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 10.7 million more out-of-work Americans than there were in February, before the pandemic hit.
“Initial unemployment insurance claims are only now approaching peak Great Recession levels 33 weeks into the COVID-19 crisis," said Daniel Zhao, Glassdoor senior economist. "The fact that claims have significantly improved from the worst parts of the crisis, while still extremely elevated at three times that of pre-crisis levels, is a daunting reality that suggests layoffs continue to ripple through the economy."