US sees 1.3m new jobless claims as coronavirus cases remain high
More than 1.3m Americans made new jobless claims last week, the Labor Department said, keeping claims on a downward trajectory despite a spike in coronavirus cases in the US.
Weekly jobless claims peaked at over 6m at the end of March and have been steadily declining since then. Last week’s figure was better than expected.
However, they have plateaued at around 1.5m over the last few weeks, a far higher level than anything seen before the coronavirus pandemic.
The 1.3m new claims figure came a day after the US reported a fresh record for new coronavirus cases, notching up 59,400, according to a New York Times database.
The surge in cases has caused a number of states, such as Florida and Texas, to rein back some plans to reopen.
Whether the return of some coronavirus restrictions causes a spike in job losses remains to be seen. As of yet they have not fed through.
Last week, the Labor Department said a record 4.8m jobs were created in June. That continued the employment rebound after the loss of 20m jobs in April.
June’s better-than-expected figures pushed the unemployment rate down to 11.1 per cent from 13.3 in May and 14.7 per cent in April. Nonetheless, it remains well above the historical average.
Richard Flynn, UK managing director at investment firm Charles Schwab, said: “US jobless claims have continued to level off in recent weeks as more people return to work.”
Yet he said: “The recent surge in new virus cases in several states poses a near-term risk to the labour market and could potentially derail the US market’s recovery in the coming weeks.”
“This lingering uncertainty may weigh on investor optimism, recently bolstered by a second-straight month of stronger than expected nonfarm payroll data.”