By: Thomas Catenacci
The number of Americans filing new unemployment claims decreased to 847,000 last week as the economy continued to suffer the effects of the ongoing coronavirus pandemic, according to the Department of Labor.
The Bureau of Labor and Statistics (BLS) figure released Thursday represented a decrease in the number of new jobless claims compared to the week ending Jan. 16, in which there were 900,000 new jobless claims reported. Roughly 18.3 million Americans continue to collect unemployment benefits, according to the BLS report Thursday.
Economists expected Thursday’s jobless claims number to come in around 875,000, The Wall Street Journal reported. New jobless claims fell below 1 million in the first week of August, which was the first time the weekly claims had fallen below 1 million since March.
“The virus is in the driver’s seat — there’s no getting around it,” Daniel Zhao, senior economist and data scientist at Glassdoor, told the WSJ. “Until we control the pandemic, we can’t hope for a full recovery economically.”
Meanwhile, stocks surged to record highs last week as President Joe Biden was sworn into office and Democrats became the majority party in Congress. Investors were optimistic about Biden’s proposed $1.9 trillion relief bill, which includes $2,000 direct payments to Americans and an additional $400 in unemployment pay per week.
“Neither the president-elect, nor I, propose this relief package without an appreciation for the country’s debt burden,” Janet Yellen, Biden’s pick to lead the Treasury Department, said Tuesday during her confirmation hearing. “But right now, with interest rates at historic lows, the smartest thing we can do is act big.”
But many of the stock market gains have been erased since Biden’s inauguration, according to CNBC. The S&P 500 and Dow Jones Industrial Average suffered their worst days since October on Wednesday.
Biden inherited an economy that has been sluggish in recent weeks and months. The U.S. lost 140,000 jobs in December, marking the first jobs loss since April, according to the Department of Labor data released Dec. 4. U.S. retail sales plummeted by 1.1% in November even as holiday shopping began, a Department of Commerce report showed Dec. 16.
Jobless claims hovered around 200,000 per week before the pandemic, according to The WSJ. Former President Donald Trump declared a national emergency in March as coronavirus spread rapidly around the world.
Average coronavirus cases and deaths per million have stayed elevated for months, according to The COVID Tracking Project. On Wednesday, the U.S. reported 4,077 new coronavirus-related deaths and 151,675 new cases while 107,444 Americans remained hospitalized from the virus.
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