By Kim Mackrael
The number of people applying for jobless benefits trended down
in recent weeks, suggesting the pace of layoffs eased despite a
resurgence in new coronavirus cases and the return of some economic
Weekly claims for new unemployment benefits fell below 800,000
in October for the first time in seven months. While that level
remains high by historic measures, it is down sharply from a peak
of nearly seven million in late March, when states first introduced
lockdowns in an effort to slow the spread of the virus. The Labor
Department will publish the latest data at 8:30 a.m. Eastern time
The number of workers receiving ongoing unemployment benefits,
known as continuing claims, is also trending at the lowest level
since March, but has remained more than four times February's
weekly average in recent weeks.
New benefit applications have declined as businesses continued
to hire back employees they had laid off during the spring shutdown
and some industries created new jobs in response to changes in
consumer demand. And some regions of the country, including the
South, saw economic recoveries continue in recent months, even as
virus cases rose.
The labor market has recouped more than half of the 22 million
jobs that were lost in March and April, but the pace of the
recovery slowed in recent months.
The claims data comes a day ahead of the release of the October
jobs report, the government's broadest look at the labor market.
Economists surveyed by The Wall Street Journal forecast employers
added 530,000 jobs in October, a slowdown from the 661,000 jobs
added in September and 1.5 million in August. Economists expect the
unemployment rate to edge down to 7.7% from 7.9% in September.
Some industries are facing questions about their long-term
viability. Last week, Boeing Co. said it would reduce its workforce
by another 11,000, including 7,000 layoffs, as the aerospace
company grapples with sharply lower demand for international and
domestic air travel. Oil giant Exxon Mobil Corp. said it would cut
1,900 jobs in the U.S.
Rising cases of Covid-19, the disease caused by the new
coronavirus, could pose a threat to job gains, economists say, if
consumers become more cautious and more states bring back
The seven-day moving average of reported Covid-19 infections in
the U.S. reached a record on Tuesday and daily case counts are on
the rise in most states, according to data from Johns Hopkins
University. Some jurisdictions, including Maine and Massachusetts,
recently tightened limits on indoor gatherings and business
"As these last few weeks have shown us, the pandemic is not
over," said Alfonso Flores-Lagunes, an economist at Syracuse
University. He said the recent surge in Covid-19 cases could lead
to another round of business closures and job losses, potentially
unwinding a portion of the labor market's summer rebound.
And until a vaccine becomes widely available, Mr. Flores-Lagunes
said, weaker consumer demand will continue to weigh on the
recovery. "Going back to normal in terms of economic activity
really depends on getting the virus under control," he said.
Some businesses are hiring, reflecting that job creation remains
strong, relative to last year's pace, when employers added an
average of 178,000 jobs a month. In New Jersey, where the
unemployment rate declined by more than 4 percentage points in
September to 6.7%, nonprofit organization Goodwill said it has been
connecting workers from the pandemic's hardest-hit industries,
including food service and hospitality, to better-performing
sectors such as customer service and sales.
"There are a lot of employers that are looking to hire folks,"
said Jennifer Mauro, Goodwill's vice president of employment and
training in southern New Jersey and Philadelphia. She said some
companies have created new positions related to virus safety, such
as cleaning and sanitization, and demand for workers in
transportation has increased with a rise in online shopping.
However, she added some people haven't been able to return to
the workforce because they lack child care, and others are
reluctant to take jobs that pay significantly less than their
The number of job postings increased in October from the
previous month, but they remain about 7.5% below their year-ago
levels, according to ZipRecruiter economist Julia Pollak. There are
also early signs that holiday hiring will be particularly weak this
year, with fewer people making travel plans and shopping at
bricks-and-mortar stores. Ms. Pollak said holiday-related job
postings were down 18.5% in September and October compared with the
same months last year.
Thursday's report from the Labor Department provides data on
regular state programs -- which have served as an economic
bellwether for a half-century -- as well as details from two
pandemic-specific programs first implemented in March.
The larger of those programs -- available to the self-employed,
gig workers and others not typically eligible for unemployment aid
-- paid benefits to about 10 million workers in early October,
according to the Labor Department. That number exceeded those
receiving benefits from state programs, which cover most U.S.
A second pandemic program pays 13 additional weeks of benefits
to individuals who have exhausted regular unemployment benefits.
Enrollment in that program moved higher in recent weeks, topping
three million last month. That suggests that some of the decline in
state-benefit recipients represents workers who have exhausted the
maximum amount of payments available through those programs.
Write to Kim Mackrael at email@example.com
(END) Dow Jones Newswires
November 05, 2020 05:44 ET (10:44 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.