The overall trend is that first time claims for unemployment insurance had beaten the estimates calculated by Wall Street. From the week ending on Sept. 12 filings were 860,000 which beats the estimate of 8750,000 which was calculated by economists who surveyed the Dow Jones. Compared to earlier weeks calculations this is lower than the actual number of 893,000. The downshift in claims had a minimal impact on the markets as Wall Street opened at a slightly lower margin. The current biggest threat to the claims is the expected resurgence in COVID cases that would stall or even worse reverse the gains that have been seen in the economy recently. Adding on to the decline in first time claims, there has also been a decline continuing claims as they have fallen 916,000 to total of 12.63 million. Lastly the end of government assistance for unemployed workers could increase the problem in job market, the pace of claims though is continuing to fall which is a good indicator. The overall analysis is that the economy is still slow or stagnate in specific sectors but there are some bright spots that are emerging out of the woodwork. This being one of them, seeing a dip in first time claims is indicative that some Americans are getting back to work and do not need unemployment benefits no longer. The bigger question becomes will this trend be a consistent one moving forward, or will it spike again as feared?
https://www.cnbc.com/2020/09/17/weekly-jobless-claims.html
4 comments:
I think it is likely unemployment will continue to decrease. Even though the battle with Covid is far from over, employers are likely becoming increasingly tired of working remotely and will need to add jobs when returning to a physical office space. Additionally, as the general public get more tired and complacent with their fight against Covid, people will continue to return to restaurants and visit shops (as has been the case in recent months). Even if this is unwise, it will at least increase employment, as many of the people laid off due to the pandemic have been in the service industry.
Jobless claims getting lower is definitely a positive, but I don't think it is representative of the state of the economy. Also, recently there has been another spike due to the wildfires in California, the rise is probably temporary, yet it shows that the U.S. labor market is not improving as rapidly as it did earlier, especially during the summer months.
i agree with marya that this rise is probably temporary because of the wild fires in the west of the US. that being said the economy in terms of the labor market it is not improving as much in the summer months because the amount of cases are higher and are making some business close due to positive outbreaks. i think that by this coming summer the labor market will have drastically improved compared to now.
I have a feeling that COVID is going to spike again. We are already seeing increases in Europe and the U.S. New cases in the U.S. reached a peak in late July and then dropped nearly 50% in mid-September, but they have since started to rise again. States are lifting COVID restrictions and some states even lifting the mask mandates. It will really be interesting to see if the loosening of restrictions will lead to another shut-down and an increase in unemployment claims.
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