Initial Jobless Claims Unexpectedly Drop Below 800,000
The number of initial jobless claims unexpectedly fell last week, dropping below 800,000 for the first time in four weeks, but staying well above any pre-pandemic standard.
On a seasonally adjusted basis, there were 787,000 initial unemployment claims in the week through Dec. 26—19,000 fewer than the week before and well below the three-month high of 892,000 reached two weeks earlier, Department of Labor data showed Thursday. Economists polled by Moody’s Analytics had expected about 850,000.
Weekly claims are still three to four times higher than they were prior to the pandemic, and some economists warned the unexpected decline should be taken with a grain of salt, in part because the holidays can make even seasonally adjusted data less reliable. Seen as a leading economic indicator, the measure of new unemployment trended in the wrong direction in December, as a spike in COVID-19 cases kept people at home.
“The unexpected decline doesn’t alter our view that the job market is ending this year on a poor note,” Ryan Sweet, a senior director at Moody’s, wrote in a commentary.
Under the Pandemic Unemployment Assistance (PUA) program—a special federal program for self-employed workers and others who aren’t eligible for regular unemployment insurance—there were 308,262 initial claims filed last week, a decline of 88,686. The PUA was one of two unemployment programs extended through March 14 by the new $900 billion economic relief package enacted this week.