Jobless claims 15,000 below economists’ forecasts
The number of US citizens claiming unemployment benefits fell to the lowest point in 17 months last week following another month of solid growth.
However, the rising number of Covid-19 infections could pose a risk to the labour market recovery.
“A healthy drop in unemployment claims is the latest evidence the rise of the Delta variant isn’t having a significant effect on the economy,” said Robert Frick, corporate economist at Navy Federal Credit Union in Vienna, told Reuters. “We can infer that hiring remains strong in August, pointing to a healthy jobs report for this month.”
For the week ending August 14, initial claims for state unemployment benefits dropped by 29,000 to a seasonally adjusted 348,000. It is the fourth week in a row in which there has been a decline, resulting in the lowest levels since March.
Economists polled had previously forecast 363,000 applications for the latest week.
Markets were up and down on the back of the news, with the Dow Jones Industrial Average down by 0.43% at the time of writing.
A large portion of the fall in claims came from Texas, which fell by 8,311, according to unadjusted data.
A large jobs gap, however, persists, with 6m fewer Americans considered employed now compared to before the pandemic.