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Self-employed workers and workers applied for unemployment benefits last week at half the level of the previous week, according to data from the Department of Labor reported on Thursday.
This suggests a strong recovery, going from persistently high levels – even rising – in recent weeks.
But that comeback probably didn’t happen. It only appeared on paper, experts say.
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Initial claims for pandemic unemployment assistance – a temporary federal program that pays benefits for concerts and other workers who are not eligible for state aid – dropped to about 161,000 last week. In the previous week, about 310,000 workers applied for PUA benefits.
Economists and unemployment experts gave some explanations as to why the decline took place.
The sharp drop probably refers to the timing of a recent $ 900 billion Covid aid package, administrative blockages between states and workers’ behavior, they said.
It also comes against the backdrop of stubborn large claims for benefits in other unemployment programs. Overall, more than 1 million Americans called for help last week.
“The 50% drop in initial claims is nothing to consider,” said Elizabeth Twitter Pancotti, a policy adviser at Employ America, a progressive group.
Why drop?
As a result, the program was temporarily unavailable to many workers, experts said.
Also, many workers did not apply for benefits, given the lack of clarity about the availability of additional weeks of benefits.
“There was a lot of uncertainty about whether the PUA would be extended, which could have affected the applicant’s behavior,” said AnnElizabeth Konkel, an economist at work. said.
Experts agree that, in general, the data is insensitive and that states will change the data to next week’s account, which would certainly increase the number.
Many states – Arkansas, Colorado, Delaware, Florida, Indiana, Minnesota, Ohio and Wyoming – did not report any data on initial claims for the PUA program during the week ended January 2. However, they reported a combined total of more than 100,000 the previous week, according to the Department of Labor.
Other states such as Illinois, Kentucky and Louisiana reported a total of just 75 claims – tens of thousands less than at the end of December.