Total US unemployment shrinks for the first time since coronavirus layoffs began in March
The weekly decline in total unemployment and initial claims comes as the US begins to reopen its economy following about two months of sweeping lockdowns to contain the spread of COVID-19. Now, all 50 states have relaxed at least some of the restrictions they put in place in March.
Falling continuing employment suggests that as states reopen, businesses that had to lay off employees when the virus hit are hiring people back, according to Ian Shepherdson, chief economist at Pantheon Macroeconomics. Still, the headline number may overstate the true extent of hiring, according to Shepherdson. This is because California requires people to file for benefits on a bi-weekly basis, and this report reflects an off-week. California continuing claims fell by 1.4 million this week, even though the state remained in a near-total lockdown during the week reflected. David Herro was the world's best international stock-picker for a decade straight. He breaks down 8 stocks he bet on after the coronavirus decimated markets — and 3 he sold. "We're discounting this as evidence of an improving labor market," Shepherdson said. There were more positive signs in other state numbers, however — Florida's continuing claims fell by 1.6 million during the week. Some economists are hesitant to cheer the decline or say it represents a turn in the labor market. While there may be signs that hiring is picking up, there's still a long way to go before the damage of the coronavirus pandemic is undone. In addition, new programs have made the weekly jobless claims report more difficult to parse. The slump in continuing claims this week may not be due to hiring, according to James Knightley, chief international economist at ING. The decline "may reflect more the fact the continuing claims numbers are state benefits and don't include the people claiming the Pandemic Unemployment Assistance - they are not eligible for regular or extended unemployment benefits," said Knightley. Filings under the separate Pandemic Unemployment Assistance program, which expands benefits to those not previously eligible, fell to an unadjusted 1.19 million from 1.25 million Thursday, representing 32 states reporting. Including PUA, the total number of initial claims under federal and state programs declined to 3.1 million for the week ending May 23. Thursday's report also showed that the total number of people claiming benefits for all programs — state and federal — rose to about 31 million in the week ending May 9 from 27.3 million a week earlier. The measure is the broadest look at how many Americans are filing for unemployment, and is not seasonally adjusted. Do you have a personal experience with the coronavirus you'd like to share? Or a tip on how your town or community is handling the pandemic? Please emailfrom Business Insider Intelligence on how COVID-19 is affecting industries.
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