837,000 Americans filed for unemployment benefits last week, confirming (again) that the labor market has reached what might euphemistically be described as “equilibrium”, wherein the new “normal” are weekly jobless claims well in excess of the pre-pandemic record set in 1982.
The market was looking for 850,000 on the headline initial claims print, so this is a “beat”, technically.
Last week’s level was revised up slightly to 873,000.
Unadjusted initial claims were 786,900, down from 827,200 in the prior week. The four-week moving average fell to 867,250. Again, there isn’t anything “good” about this. And, as Bloomberg notes, “the report came with a key caveat: the figures from California, the most populous state, used the prior week’s numbers because the state suspended acceptance of new applications for two weeks to improve its systems and cope with a backlog of filings”.
Nancy Pelosi and Steve Mnuchin were working towards a compromise bill on additional virus relief and the legislation seemed likely to include a $400 federal unemployment supplement. That’s less than Democrats want (Pelosi is looking for a full renewal of the $600/week provided under the previous stimulus bill), but it would give millions of Americans some clarity on the situation.
Donald Trump’s executive order from August was a piecemeal solution and implementation has been the very definition of haphazard. For early adopter states, the benefits ran out weeks ago.
Continuing claims clocked in at 11,767,000 for the week ended September 19. That’s a decent beat versus consensus, which was expecting 12.2 million.
Thursday’s figures paint a picture of a labor market that is far from “normal” even if things are much improved.
With any “luck”, Trump can offset some of the backlash from voters who are still jobless by cajoling Mitch McConnell into cramming a Mnuchin-Pelosi compromise deal that includes another round of direct checks through the Senate ahead of the vote. Those hopes faded on Thursday evening, though, when the House moved ahead with a vote on Democrats’ $2.2 trillion package after Pelosi and Mnuchin failed to bridge the gap.
Remember: It’s not a “V”…