The number of Americans filing for unemployment benefits fell to its lowest level in more than half a century last week, another indicator that the job market in the United States is quickly recovering from last year’s coronavirus recession.
The number of people filing for unemployment benefits fell by 71,000 to 199,000, the lowest level since mid-November 1969. The drop was far greater than economists had anticipated. The four-week average of claims, which smooths out weekly fluctuations, fell by 21,000 to just over 252,000, the lowest level since the pandemic hit the economy in mid-March 2020.
Since peaking at 900,000 in early January, the number of applications has progressively decreased, eventually dipping below the pre-pandemic level of roughly 220,000 per week. Jobless benefits are a proxy for layoffs. In the week ending Nov. 13, 2 million Americans received regular unemployment payments, down marginally from the week before.
Until September 6, the federal government bolstered state unemployment insurance systems by paying an extra $300 per week and extended benefits to gig workers and individuals who had been unemployed for six months or longer. In June 2020, the number of Americans getting some sort of unemployment assistance, including federal programs, surpassed 33 million.
Since the spring of 2020, when the coronavirus epidemic drove businesses to close or reduce hours and left many Americans at home as a health jobs precaution, the job market has made a spectacular comeback. Employers cut more than 22 million jobs in March and April of last year.
Government relief checks, ultra-low interest rates, and the introduction of vaccines, on the other hand, gave consumers the confidence and financial means to resume spending. Employers have made 18 million new recruits since April 2020, scrambling to meet an unanticipated rise in demand, and are likely to add another 575,000 this month. Despite this, the United States is still 4 million jobs short of where it was in February 2020.
Companies are now complaining about not being able to find people to fill job openings, which reached a near-record 10.4 million in September. Workers are getting more picky about jobs as they obtain bargaining power for the first time in decades; a record 4.4 million departed in September, indicating that they are confident in their capacity to find something better.