New applications for U.S. unemployment benefits fell for the fourth straight time last week, dropping to the lowest level since the Covid-19 pandemic began, according to government data released Thursday that was hailed by President Joe Biden.
Initial jobless claims fell to 348,000, seasonally adjusted, in the week ended August 14, the Labor Department reported, the latest sign of recovery in the closely-watched metric of labor market health even as rising infections from the Delta variant of Covid-19 threaten to derail the progress.
That was fewer than analysts had expected and 29,000 less than the prior week, bringing claims closer to the level seen before the pandemic forced nationwide business closures that caused millions of layoffs.
"This morning's news reinforces the historic nature of our economic recovery," Biden said in a statement, crediting the improvement to his policies including the $1.9 trillion American Rescue Plan spending package enacted in March.
"While our economic recovery is far from complete -- and while we will have ups and downs along the way as we continue to battle the Delta surge of Covid -- the Biden plan to grow the economy from the bottom up and middle out is working, and delivering real results for American workers," Biden said in a rare comment on the weekly economic data.
Delta Risk
While Ian Shepherdson of Pantheon Macroeconomics called the data "encouraging," he warned of the risks posed by the virus's fast-spreading Delta variant, which has forced some businesses to again modify operations.
"It's entirely possible that firms' first reaction to the Delta wave has been to slow the pace of recruitment, before taking the more difficult decision to let go existing staff," Shepherdson wrote in analysis.
Another 109,379 new claims, not seasonally adjusted, were filed last week under the Pandemic Unemployment Assistance program to help freelance workers, slightly more than the week prior, according to the report.
That program was among several emergency measures created as the pandemic began to help jobless workers, and extended repeatedly as the crisis dragged on.
All of those expanded programs are set to end next month, though about half of states have rolled them back early, arguing they encourage people not to work.
There were still more than 11.7 million people receiving unemployment benefits under all programs as of July 31, according to the data, a decline from the previous week but a sign of the work still to be done to heal the U.S. labor market.
Another pandemic low was seen in insured unemployment, which indicates the number of people actually receiving regular state jobless benefits and dropped to just over 2.8 million as of the week ended August 7.
