Another 850,000 Americans likely filed new unemployment claims last week

The US economy likely saw yet another historically high number of first-time unemployment insurance claims filed last week, as the coronavirus pandemic continues to strain the labor market.

The U.S. Department of Labor (DOL) is set to release its weekly jobless claims report at 8:30 a.m. ET Thursday. Here were the main metrics expected from the report, compared to Bloomberg estimates:

  • Initial jobless claims, week ended Sept. 26: 850,000 expected vs. 870,000 during the prior week

  • Continuing claims, week ended Sept. 19: 12.2 million expected vs. 12.58 million during the prior week

Consensus economists anticipate that 850,000 individuals filed new jobless claims last week, for an only marginal step down from the 870,000 reported during the prior period. Such a result would mark the fifth straight week that new jobless claims come in below 1 million.

But six months since the pandemic took hold in the US and decimated economic activity, new jobless claims are still running far above levels from before the outbreak. As recently as in February this year, new jobless claims were coming in at a rate of around 200,000 per week.

Continuing jobless claims, reported on a one-week lag and reflecting the number of individuals still receiving unemployment benefits, have also come down from their pandemic-era highs but stagnated at high levels. Continuing claims are anticipated to have declined to 12.2 million in the latest print, which would mark a pandemic-era low, but would still top the previous record high of 6.6 million continuing claims filed in one week during June 2009.

“Initial claims, which seem to be stabilizing at an elevated level, suggest the labor market recovery is plateauing,” Nomura economist Lewis Alexander said in a note Friday. “That said, recent declines in continuing claims suggest that rehiring activity continued to offset declines.”

Still, a wave of new layoffs from major corporations looms. On Tuesday, Disney (DIS) said it would be cutting 28,000 jobs in its resort business, in one of the deepest reductions announced so far during the pandemic period. Shell (RDS-A) on Wednesday said it planned to slash up to 9,000 positions by the end of 2022. And airlines including American Airlines (AAL) and United Airlines Holdings (UAL) have each warned they could furlough some 19,000 and 12,000 workers, respectively, following the October lapse of provisions under Congress’s CARES Act that gave the industry billions to help keep workers on payrolls.

The latest weekly jobless claims print comes a day before the Labor Department’s monthly September jobs report, which consensus economists believe will show the first monthly increase in payrolls of less than 1 million since April. ADP’s private payroll report out Wednesday – an imprecise but typically at least directionally accurate indicator of the payroll changes reflected in the Labor Department’s reports – showed private employers added back a better than expected 759,000 jobs during the month.

The Labor Department’s survey week for the non-farm payrolls report takes place around the 12th of each month. During that week, continuing jobless claims ticked down slightly to 12.58 million from 12.75 million. Initial claims also fell slightly to 866,000 during that week, from 893,000 the prior week.

This post will be updated with the results of the Labor Department’s weekly jobless claims report Thursday morning at 8:30 a.m. ET.

Another 870,000 Americans filed for new unemployment claims last week on a seasonally adjusted basis. (David Foster/Yahoo Finance)

Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck

Read more from Emily:

Find live stock market quotes and the latest business and finance news

For tutorials and information on investing and trading stocks, check out Cashay

Follow Yahoo Finance on TwitterFacebookInstagramFlipboardLinkedIn, and reddit.

Source Article

About the author