Initial unemployment benefits were higher than expected last week, with 719,000 more workers crossing the unemployment line, the Labor Department reported Thursday.
The total was compared to the Dow Jones estimate of 675,000 and was higher than last week’s revised downward of 658,000.
While the number of weekly claims remains extraordinarily high by historical standards, the trend is now declining as the U.S. economy continues to open and nearly 3 million Americans are vaccinated against Covid-19 every day.
The ongoing claims, a week behind the headline, fell by 46,000 to just under 3.8 million.
“If you look at the two weeks together, it is clear that the claims trend is declining,” wrote Ian Shepherdson, chief economist at Pantheon Macroeconomics. “We expect a sustained sharp decline in the second quarter when the economy opens again, making it easier for companies under financial strain to retain employees.”
In another sign of the downward trend in unemployment, the four-week moving average of claims fell to 719,000, its lowest level since March 14, 2020 when the pandemic began.
The total number of those receiving benefits also fell sharply, declining 1.5 million to 18.2 million, mainly due to a decrease in those receiving pandemic-related benefits. These dates are two weeks ago.
At the state level, Virginia (+30,696), Kentucky (15,869), Georgia (11,862), and California (9,628) saw the largest increases according to unadjusted data.
The report comes a day ahead of the government’s non-farm workforce for March, which is projected to increase from 675,000, followed by 379,000 in February. Ohio (-15,718) and Massachusetts (-12,755) saw the largest declines.
In addition to efforts to fight the virus, the Biden government continues to shovel money to stimulate an economy that is showing signs of solid growth. The president on Wednesday tabled a $ 2 trillion spending plan, building on more than $ 5 trillion in incentives either already issued or announced for programs aimed at getting the nation out of the slump .
While the pace of employment growth slowed at the beginning of winter, recent evidence suggests that hiring has picked up.
Payroll firm ADP estimated the companies hired 517,000 people in March, the fastest pace since September. Recent manufacturing reports also show plans for more hires, and job gains appear to be strongest in the ailing hospitality sector, which has suffered the worst losses from social distancing and government-imposed restrictions.