The number of Americans newly seeking jobless benefits plummeted last week, falling past pre-pandemic levels to the lowest point since 1969 more than a year and a half after the start of the pandemic, the feds said Wednesday.
As of last week, initial filings for unemployment benefits, seen as a proxy for layoffs, fell to 199,000, down 71,000 from the prior week’s revised level of 270,000, according to data released Wednesday by the Labor Department.
Economists surveyed by Dow Jones expected to see new claims fall to 260,000, after seeing five consecutive weeks of decreases.
After ticking up in September, new claims have since been steadily falling as the labor market slowly recovers, but Wednesday’s report showed the figure plummet, suggesting a robust recovery in the labor market this month.
Weekly new claims have fallen substantially from the 2020 peak of about 6.1 million new claims in a single week, and have now even passed below the 200,000 new claims per week seen before the pandemic.
Still, the recovery in the labor market could be threatened by the recent resurgence of COVID-19, which could once again scare people away from work, sending claims higher once again.
Wednesday’s report also showed that continuing claims fell by 60,000 from the prior week’s revised level, according to the new data. That figure stood at about 6 million at the same time last year, in the thick of the pandemic.
Just over 2 million Americans remain on traditional state unemployment benefits, the feds added.
Companies managed to add 531,000 jobs in October — the biggest monthly gain in three months — and the unemployment rate fell to 4.6 percent from 4.8 percent a month earlier, the Labor Department reported earlier this month.
The economy is still missing more than 4 million jobs compared with just before the pandemic, though.
The latest jobless claims report comes two week after the feds announced that the Labor Department’s Consumer Price Index, which measures a basket of goods and services as well as energy and food costs, jumped 6.2 percent in October from a year earlier, its biggest year-over-year spike in more than 30 years.
The huge price increases have stoked criticism from some economists and politicians who blame the Federal Reserve, saying that Chairman Jay Powell pumped too much money into the economy through emergency pandemic programs.
The scorching inflation readout spurred some renewed calls for the Federal Reserve to hasten the tapering of its bond-buying program and to raise interest rates sooner rather than later.
But the Fed has insisted that cost increases are only temporary and that it would be a mistake to raise interest rates before the employment picture improves.