Americans continued to hit the unemployment line last week in large numbers, as the continued rise in Covid cases added to the issue of American unemployment.
Unemployment applications totaled 900,000 for the week ended Jan. 16, the Labor Department said Thursday. This was slightly lower than the Dow Jones estimate of 925,000 and below the revised total of 926,000 the previous week.
Markets have reacted little to the news, amid continued anticipation that President Joe Biden and Congress will soon provide another major tax infusion to help the economy weather the pandemic. Futures showed a modest gain on Wall Street.
Ongoing demand showed a slight decrease for the week, falling by 127,000 to 5.05 million.
Weekly claims have been on a downward trend since they exploded in March and April in the early days of the pandemic, but began to move again in October amid tightening trade restrictions.
The hospitality industry was hardest hit, as hotels, bars, restaurants and casinos were either closed or forced to limit guest capacity. In January alone, the industry lost 498,000 workers.
The latest complaints report shows that the total number of Americans receiving unemployment benefits continues to fall, albeit largely due to declining pandemic programs by the end of 2020.
There have been just under 16 million beneficiaries in the latest data, down from 18.4 million. However, the decline in pandemic demands will not last long, as the latest tax package includes extensive benefits for displaced workers.
Several large states, which had a heavier hand, with restrictions, saw the increase in complaints from the previous week moderate. California (-58,665), New York (-12,212) and Pennsylvania (-9,638) recorded notable decreases. The games came from Arizona (15,347) and Illinois (13,948).
Other economic news this morning was better than expected.
Home starts totaled 1.67 million compared to an estimate of 1.56 million, while permits reached 1.71 million compared to Dow Jones’ 1.61 million expectations. The Philadelphia Fed’s business activity index jumped to 26.5, better than the 10.5 estimate.