Unemployment claims in the United States rise unexpectedly but remain near pandemic level | Unemployment News

Claims rose from 2,000 to 373,000 during the week ending July 3, the US Department of Labor said Thursday.

U.S. state unemployment insurance claims edged up last week, although they remained near a pandemic low as the labor market heads for a full recovery.

Initial claims in the state’s regular programs increased from 2,000 to 373,000 during the week ended July 3, Labor Department data showed Thursday. The median estimate from a Bloomberg survey of economists predicted 350,000 new applicants.

Even with the latest increase, new weekly jobless claims have more than halved since the start of the year as health concerns ease and pent-up demand fuels hiring at companies like hotels and restaurants.

Economists expect the labor market to improve further in the second half of this year, with the unemployment rate expected to fall below 5% in the fourth quarter.

More than half of U.S. states are ending enhanced federal unemployment benefit programs amid an ongoing debate over whether they are hampering hiring efforts.

Continuing claims for outstanding state benefits fell to a pandemic low of 3.34 million during the week ended June 26. This may reflect more Americans taking jobs and falling on benefit lists now that the $ 300 weekly supplement has ended in many states.

States like Oklahoma, Nebraska and Indiana – which ended Pandemic Unemployment Assistance (PUA) for the self-employed – saw no initial applications for the program last week.

Gradual withdrawal from the program

Meanwhile, initial claims in Texas and Nebraska resumed last week, which may reflect attempts to transition to regular state programs now that PUA has been phased out in those states.

“It is possible that some people will make initial applications to re-determine their eligibility if they lose benefits from one of the expiring programs, but we believe that in most cases these people would not be eligible for the benefits,” economists from JPMorgan Chase & Co. said in a recent memo.

Pennsylvania and New York state saw the biggest increases in initial claims last week, while claims in Oklahoma and Maryland fell.

The latest jobs report showed payrolls rose 850,000 in June, the biggest gain in 10 months, suggesting companies were more successful a month later in recruiting workers to fill the positions. vacant. Yet vacancies hit a record high in May, indicating a mismatch between labor supply and demand.