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jobless weekly

U.S. weekly jobless claims total 1.186 million, lowest level of the coronavirus pandemic – CNBC

Weekly jobless claims hit their lowest level of the pandemic era, totaling 1.186 million last week, well below Wall Street expectations.

Economists surveyed by Dow Jones had been looking for 1.42 million. The level for the week ended Aug. 1 represented a drop of 249,000 from the previous period. 

Amid worries that the employment picture was faltering after two record-breaking months of job creation, the claims number indicates some momentum. Continuing claims, or those who have collected benefits for two straight weeks, dropped by 844,000 to 16.1 million.

Markets reacted positively to the news, with Dow futures shaving almost all of their earlier losses as stocks looked to open about flat.

The last time the weekly claims number was this low was March 14, just as the coronavirus hit pandemic status and the U.S. economy came to a standstill in an effort to halt the spread. The totals since then have easily eclipsed anything seen before in records going back to 1967.

Even with this past week’s improvement, the total remains well above the pre-pandemic record of 695,000 in 1982.

“Both initial and continuing claims are at extremely high levels, and indicate that many employers continued to lay off workers in July,” PNC senior economist Bill Adams said in a note. “Further complicating the picture, the expiration of extended unemployment insurance benefits on July 31 may be clouding the signal from the claims data.”

The four-week moving average, which smooths volatility in the numbers, fell by 413,250 to 16.6 million. But the damage to the labor remains deep and this was the 20th consecutive week that claims have run above 1 million.

The total of those claiming benefits, which lags the current data by two weeks, rose to 32.1 million as of July 18, an increase of 1.3 million from the previous week. 

Pandemic Unemployment Assistance recipients declined to 655,707, a fall of 253,093 from the previous week as the program expired July 31. The program provided benefits to those who normally wouldn’t be covered under traditional unemployment insurance. Congress and the White House are working on an extension of the program but have not reached an agreement yet.

The report comes a day ahead of the Labor Department’s nonfarm payrolls release for July. Economists expect it to show growth of nearly 1.5 million, though Wednesday’s private payrolls report from ADP, which showed a gain of just 167,000.

The past week’s improved showing from claims will not be reflected in the July count as it falls outside the Bureau of Labor Statistics’ sample week.

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Enhanced jobless

Enhanced jobless benefits expired overnight: Here’s where Congress’ negotiations stand – CNN

Washington (CNN)The federal enhanced unemployment benefit that out-of-work Americans have relied on amid the coronavirus pandemic has now officially expired — and Democrats and Republicans are still far apart in negotiations over a new stimulus package that could bring relief with no deal in sight.

Talks continued Saturday with House Speaker Nancy Pelosi hosting a meeting with Senate Minority Leader Chuck Schumer in the Speaker’s office with the lead negotiators for the Trump administration, White House chief of staff Mark Meadows and Treasury Secretary Steven Mnuchin, but no deal was ultimately reached. The group will meet again on Monday and members of their staffs will meet Sunday to discuss issues, Schumer said.
Pelosi and Schumer told reporters following the meeting that the morning’s discussions were productive, but that the sides still are not close to an agreement.
“The best discussions we’ve had so far, I call it progress but a ways to go,” Schumer said, noting that it was the longest meeting the group has had to date.
Mnuchin and Meadows echoed that sentiment. “We’re still a long ways apart, and I don’t want to suggest that a deal is imminent because it is not,” Meadows said. “But like with any deal, as you make progress, I think it’s important to recognize that you’re making progress and not set an unrealistic expectation that we are just a few items away. Because there are still substantial differences, but we did make good progress.”
Mnuchin told reporters that “there’s clearly a subset of issues where we both agree on,” listing an extension of unemployment insurance, schools, the Paycheck Protection Program and jobs.
Pelosi had reiterated prior to the meeting that Democrats are not interested in a short-term agreement. Following the talks, Mnuchin said they were at an “impasse” over whether to pass a short-term fix to buy time for talks over a broader package.
“They’ve made clear, there’s clearly a desire on their part to do an entire package, we’ve made clear that we’re willing to deal with short-term issues and pass something quickly and come back to the larger issues, so we’re at an impasse on that,” he said.
The federal enhanced benefit program was set up to provide an additional $600 a week to individuals receiving regular state unemployment benefits and was meant as an added boost to help blunt the economic fallout from the pandemic.
There has been major disagreement, however, between Democrats and Republicans over how to deal with the program’s expiration. A House bill put forward by Democrats as their opening offer in the talks would extend the $600 enhanced benefit through January. In contrast, Republicans, in a plan unveiled at the beginning of the week, proposed cutting the weekly payment to $200 until states implement a system that replaces roughly 70% of laid-off workers’ wages.
The White House has also offered a shorter-term extension of the federal unemployment benefit, but it was rejected by Democrats who have argued any deal should be broader and include stimulus money for state and local governments, testing funding and more money for small business programs.
Republicans have argued that the existing system risks incentivizing some Americans not to go back to work by paying them more than they would at their prior jobs, while Democrats have argued that the benefits should be left intact.
At this point, there has been little progress toward any kind of deal to reinstate the benefit, but there has been plenty of finger pointing on both sides with both blaming the other for the lapse.
In dueling press conferences on Friday, Meadows took to the White House briefing room podium to accuse Democrats of “playing politics at a critical time,” while Pelosi said during her own news conference on Capitol Hill that Republicans “do not understand the gravity of the situation” and are “disrespectful of the needs of America’s working families.”
Meadows said that the White House made “no less than four” offers to Democrats dealing with the enhanced benefit and eviction protection and said that the offers were all rejected.
President Donald Trump joined in on the finger-pointing Friday afternoon, tweeting, “Pelosi & Schumer have no interest in making a deal that is good for our Country and our People.”
In a sign of just how far apart the two sides are, Pelosi pushed back Friday in an interview with CNN’s Brianna Keilar on the assertion that the White House offered a short-term extension of the benefit that Democrats rejected.
“That isn’t true,” Pelosi said. “Let’s just set the record straight. They made no such offer. They made no such offer. Don’t accept something as fact just because the White House said it.”
Pelosi went on to say, “They’re asking about doing something for a week.” She added that Republicans are “making up things that they say they’re offering and the rest. But understand this, passing something for a week without all the other things that should go with it is not any path we will go down. It’s a public relations stunt on their part.”
Amid the war of words, however, it’s worth taking note of what Senate Majority Leader Mitch McConnell put into place on Thursday, which signals upcoming action in the upper chamber.
He brought up a shell bill and, with a simple majority vote, put it into play for next week — something that creates a number of potential options, from serving as a vehicle for a short-term unemployment deal, or even a comprehensive deal, or just a place where there will be dueling messaging votes. But the point is this: there will be action on the Senate floor next week. It might all be a sideshow, but often movement of any kind starts to jar loose actual discussions which lead to actual movement on things.
House Majority Leader Steny Hoyer, meanwhile, advised members on Friday that despite a planned August recess the House is expected to meet during the month of August as talks continue around a coronavirus relief package. Members will be given at least 24 hours notice before being called back for votes.
This story has been updated with additional developments Saturday.

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claims jobless

UK jobless claims jumped 70% in April as the coronavirus hit employment – CNBC

A woman in a protective face mask walks through Brixton Market in South London, as the UK continues in lockdown to help curb the spread of the coronavirus.

Victoria Jones | PA Images via Getty Images

The number of people claiming unemployment benefits in the U.K. soared in April, as the coronavirus outbreak created mass job losses in the country, the latest data showed.

U.K. jobless claims rose by 856,500 to 2.097 million, the Office for National Statistics (ONS) said on Tuesday, representing a monthly increase of 69.1%. A Reuters poll of economists had produced a median forecast for an increase of 676,500 in the claimant count.

The ONS noted, however, that enhancements to “Universal Credit” (a social security payment designed to simplify the benefits system by rolling six benefits into one payment) as part of the U.K. government’s response to Covid-19 meant that an increasing number of people became eligible for unemployment-related benefit support, although they were still employed.

“Consequently changes in the claimant count will not be due wholly to changes in the number of people who are unemployed. We are not able to identify to what extent people who are employed or unemployed have affected the numbers,” the ONS said.

The U.K.’s unemployment rate came in slightly higher at 3.9% in the January-March period, although that time period covered only one week of the lockdown (imposed in the U.K. from March 23). The rate was up 0.1 percentage points from a year earlier and was 0.1 percentage points higher than in the last quarter of 2019.

Worse to come?

The U.K. has sought to encourage businesses to retain staff amid the coronavirus pandemic with its furlough scheme, or “Coronavirus Jobs Retention Scheme’ (CJRS). In this, the government provides a grant to employers to cover 80% of an employee’s salary, up to a maximum of £2,500 ($3,059) per month. The scheme has been popular and has been extended to the end of October.

Kallum Pickering, senior economist at Berenberg Bank, said Tuesday that despite widespread take-up of the CJRS, he expects the unemployment rate to jump to a high of around 9.5% in the late second quarter from the 3.9% rate in March.

“That implies a rise in the number of unemployed workers to around 3.3 million from the circa 1.35 million in March – far exceeding the previous peak of 2.7 million in October 2011 in the wake of the financial crisis,” he said in a note.

However, the rise will be much smaller than it would have been without the CJRS, he added. “Around 7.5 million furloughed workers are receiving wage subsidies through the scheme which has been recently extended until October. From August onwards the scheme will be adjusted to allow workers to return to work part time.”

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jobless weekly

U.S. weekly jobless benefits to stay elevated as coronavirus layoffs widen – Reuters

WASHINGTON (Reuters) – The global novel coronavirus crisis continues to batter the U.S. labor market, with millions more Americans, including white collar workers, expected to have filed for unemployment benefits last week as the hit from the pandemic spills over into a broader swath of the economy.

FILE PHOTO: A woman looks for information on the application for unemployment support at the New Orleans Office of Workforce Development, as the spread of coronavirus disease (COVID-19) continues, in New Orleans, Louisiana U.S., April 13, 2020. REUTERS/Carlos Barria

Thursday’s weekly jobless claims report from the Labor Department, the most timely data on the economy’s health, would cement economists’ expectations for a third straight month of massive job losses in May. The report would come a day after Federal Reserve Chair Jerome Powell warned of an “extended period” of weak growth and stagnant incomes.

The economy lost a staggering 20.5 million jobs in April, the steepest plunge in payrolls since the Great Depression of the 1930s, as businesses were locked down to slow the spread of COVID-19, the respiratory illness caused by the virus.

“We are on the back end of the first wave of layoffs, but now we are transitioning from the natural-disaster phase to the recession phase,” said Josh Wright, chief economist at Wrightside Advisors in New York. “That’s why so many white collar jobs are still being lost. We effectively amputated a large section of the economy, and we are going to limp along afterwards.”

Initial claims for state unemployment benefits likely totaled a seasonally adjusted 2.5 million for the week ended May 9, according to a Reuters survey of economists. While it still would be an astoundingly high number, that would be down from 3.169 million in the prior week. Claims have been gradually decreasing since hitting a record 6.867 million in the week ended March 28.

Last week’s filings would lift the number of people who filed claims for unemployment benefits to about 36 million since March 21, nearly a quarter of the working age population. Still, April was probably the trough in job losses during this downturn, which has also been marked by the sharpest decline in output since the 2007-09 Great Recession.

APPLICATION BACKLOGS

In addition to workers in industries and jobs not initially affected by the coronavirus shutdowns, economists attribute the continued elevation in claims to the processing of application backlogs, which accumulated as state unemployment offices were overwhelmed by the unprecedented wave of applications.

Many parts of the country are reopening and states and local governments are laying out plans to restart their economies. But with businesses and factories operating well below capacity, and fears of a second round of COVID-19 infections, economists do not anticipate a dramatic improvement in the labor market.

Some businesses have accessed loans from an almost $3 trillion fiscal package, which could be partially forgiven if they used the credit for employee salaries. But many small enterprises are expected to close permanently, leaving some of the 21.4 million people who lost their jobs in March and April out of work.

To gauge the depth of the unemployment problem, attention will shift to the number of people staying on jobless benefits rolls.

Thursday’s claims report is expected to show the number of people receiving benefits after an initial week of aid raced to a record 25.1 million in the week ended May 2 from 22.647 million in the prior week, according to the Reuters survey.

The so-called continuing claims data is reported with a one-week lag.

“We would expect a peak should arrive sometime in late May or June, with continuing claims falling as rehiring resumes,” said Andrew Hollenhorst, an economist at Citigroup in New York. “The speed of the decline will indicate how fast rehiring is occurring.”

The unemployment rate jumped to 14.7% in April, breaking the post-World War Two record of 10.8% touched in November 1982, from 4.4% in March.

A broader measure of unemployment, which includes people who want to work but have given up searching and those working part-time because they cannot find full-time employment, surged to 22.8% last month from 8.7% in March.

Reporting By Lucia Mutikani; Editing by Chizu Nomiyama

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