FILE PHOTO: A job seeker leaves the job fair for airport related employment at Logan International Airport in Boston, Massachusetts, U.S., December 7, 2021. REUTERS/Brian Snyder/File Photo
December 16, 2021
By Lucia Mutikani
WASHINGTON (Reuters) – The number of Americans filing new claims for unemployment benefits increased moderately last week, keeping the trend at levels consistent with tightening labor market conditions.
The weekly jobless claims report from the Labor Department on Thursday also showed more Americans getting off unemployment rolls in early December, which raises hope that an acute shortage of workers that is hampering hiring could soon ease.
The Federal Reserve acknowledged the labor market strength on Wednesday when it announced that would end its pandemic-era bond purchases in March and pave the way for three quarter-percentage-point interest rate increases by the end of 2022. Fed Chair Jerome Powell told reporters the economy was “making rapid progress toward maximum employment.”
“The biggest problem in the labor market now is a shortage of workers,” said Gus Faucher, chief economist at PNC Financial in Pittsburgh, Pennsylvania.
Initial claims for state unemployment benefits rose 18,000 to a seasonally adjusted 206,000 for the week ended Dec. 11. Claims had dropped to 188,000 in the prior week, the lowest since 1969. Economists polled by Reuters had forecast 200,000 applications for the latest week. Claims have declined from a record high of 6.149 million in early April of 2020.
The four-week moving average of initial claims, considered a better measure of labor market trends as it irons out week-to-week volatility, dropped 16,000 to 203,750 last week, the lowest level since November 1969.
Applications typically increase around the holiday season as companies temporarily close, but an acute shortage of workers has disrupted that seasonal pattern, resulting in large declines in the seasonally adjusted claims numbers in recent weeks.
There was a surge in applications in Missouri as well as big increases in Virginia and Kentucky. But claims dropped significantly in New York, Texas and Wisconsin.
“With the expansion accelerating in the fourth quarter, only the current rise in COVID-19 cases could push claims significantly higher,” said Robert Frick, corporate economist at Navy Federal Credit Union in Vienna, Virginia.
The claims report showed continuing claims declined 154,000 to 1.845 million in the week ended Dec. 4, the lowest since mid-March of 2020. At least 2.5 million people were receiving benefits under all programs in the last week of November.
There were a record 11.0 million job openings at the end of October. The unemployment rate fell to a 21-month low of 4.2% in November. There are signs that the labor market crunch is starting to ease.
Indeed Hiring Lab’s job search survey on Wednesday showed the share of the population actively looking for paid work rose two percentage points to 29.1% in November from the prior month.
The rise reflected a jump among the unemployed to the highest level since the survey started in June. But rising COVID-19 infections and the Omicron variant of the coronavirus could discourage some people from looking for work.
Millions of unemployed Americans have remained home even as generous federal government-funded unemployment benefits ended in early September and schools reopened for in-person learning. The workforce is 2.4 million below its pre-pandemic level.
(Reporting By Lucia Mutikani; Editing by Chizu Nomiyama and Andrea Ricci)
Source: One America News Network
