Initial jobless claims dip to 751,000

Initial jobless claims for the last week of October fell to a seasonally adjusted 751,000, a drop of 7,000 from the previous week, but still extraordinarily high by historical standards.

Thursday data from the Labor Department revised the number of new claims from the previous week, which had also initially been reported at 751,000, up to 758,000. Unadjusted claims fell just 543 to 738,166.

But another 363,000 Americans applied for Pandemic Unemployment Assistance (PUA), a program Congress passed in March’s CARES Act to expand unemployment benefits to gig workers and the self-employed. The program is set to expire altogether at year’s end.

“The initial unemployment number not falling as much as expected is just the tip of the iceberg, as the economy’s ability to add jobs and keep people off assistance is quickly weakening,” said Robert Frick, corporate economist at Navy Federal Credit Union.

Initial claims have dropped significantly since the peak of the coronavirus pandemic in March and April, but have remained above the previous single week record of 695,000 for new claims every week since.

The total number of people claiming unemployment benefits across a variety of programs was 21.5 million.

Labor economists are raising the alarm that additional unemployment programs are reaching their limits. In addition to PUA, another program that offers 13 weeks of benefits beyond the 26 most states allow is also due to expire. So people who were unemployed in the weeks before the recession are reaching the end of their benefits.

Labor economist Heidi Shierholz notes that some workers are “running into administrative glitches” as they try to move from one program to the next.

Congress and the Trump administration have wrangled with a new relief package for months, even after $600 in additional weekly benefits expired in July. They have failed to come up with a new bill to extend the benefits for the millions that remain unemployed.

“There are simply not enough jobs being created to support all of the workers running out of aid before the end of 2020,” said Andrew Stettner, senior fellow at The Century Foundation.

“We urgently need action before the holiday season,” he added.

Senate Majority Leader Mitch McConnell (R-Ky.) on Wednesday signaled that he wanted to approve a new relief bill before year’s end.

–Updated at 9:24 a.m.