Jobless claims hit pandemic-era low

Skill mismatch in US explains why many open jobs aren’t filled: Former Chase economist

Former Chase chief economist Anthony Chan provides insights into inflation, unemployment and the worker shortage. 

The number of Americans filing for unemployment benefits slipped to a pandemic-era low last week as more workers found jobs following the expiration of supplemental payments.

Data released Thursday by the Labor Department showed initial jobless claims in the week ended Oct. 16 fell by 6,000 to 290,000, making for the lowest reading since March 14, 2020. The previous week’s reading was revised higher by 3,000 new filings. Analysts surveyed by Refinitiv were expecting an increase to 300,000 filings. 

Continuing claims, or the number of Americans who are consecutively receiving unemployment benefits, fell by a larger-than-expected 122,000 to a pandemic-era low of 2.481 million. Economists anticipated a decline to 2.55 million. About 3.28 million Americans were collecting jobless benefits for the week ending Oct. 2, compared with an estimated 23.76 million Americans one year prior. 

"All this signals that most employers don’t need or want to shed workers," said Mark Hamrick, senior economic analyst at Bankrate. "It is quite the contrary with job openings remarkably high."

Jobless claims have gradually declined following the expiration of $300 per week in supplemental unemployment benefits in early September and as the number of new infections caused by the COVID-19 delta variant have eased. Still, businesses are having trouble finding workers.

There were 10.439 million jobs that needed to be filled in August, according to the Labor Department's most recent Job Opening and Labor Turnover Survey, or JOLTS, that was released earlier this month. There are about 2.7 million more job openings than unemployed Americans trying to find work. 

The labor market is further complicated by a record-high 2.9% quit rate and sustained headwinds from supply chain bottlenecks and inflation. 

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"With the nation’s unemployment rate at 4.8 percent, and the job market regarded as tight in many markets and sectors, the headwinds of supply chain congestion and high inflation threaten to make further significant job market improvement hard to come by," Hamrick said.

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