Jobless Claims Drop Below 400,000, Hit Another Pandemic Low

The number of Americans filing new unemployment claims dropped to 385,000 last week as the economy continues to recover from the coronavirus pandemic, according to the Department of Labor.

The Bureau of Labor and Statistics figure released Thursday represented a decrease in the number of new jobless claims compared to the week ending May 22, when 405,000 new jobless claims were reported. That number was revised down from the 406,000 jobless claims initially reported last week.

Economists expected Thursday’s jobless claims number to come in at 393,000, CNBC reported.

“We’ve heard a lot about workers being slow to rejoin the workforce and some reluctance to take the jobs that are available, but on the other side of that, the recovery is proceeding [and] layoffs are declining,” Oxford Economics lead economist Nancy Vanden Houten told The Wall Street Journal.

Thursday’s figure represented the lowest level for initial jobless claims since March 14, 2020, when the Labor Department reported 256,000 new claims, according to the report.

Roughly 15.4 million Americans continue to collect unemployment benefits, according to the report.

After the U.S. reported adding just 266,000 new jobs in April, Republican-led states began withdrawing from the federal $300 weekly unemployment bonus implemented by Democrats’ $1.9 trillion stimulus package. More than 20 states including Florida, Texas, South Carolina, Arizona and Alabama have announced their withdrawal from the federal unemployment program, Business Insider reported.

Job vacancies hit a record, surpassing 8 million, at the end of March, according to a recent Labor Department report.

Democrats said the jobs report wasn’t entirely negative and proved the need for additional legislation and government spending.

“The bottom line is this: The Biden economic plan is working. We’ve had record job creation. We’re seeing record economic growth,” President Joe Biden said during remarks on May 27. “We’re creating a new paradigm — one that rewards work, the working people in this nation, not just those at the top.”

However, Biden acknowledged there have been “bumps in the road” including “price distortions.” Multiple inflation measurements released over the last month have shown worrying signs for the ongoing economic recovery.

The Consumer Price Index showed prices increased more between May 2020 and April than any other 12-month period since 2008. In that same period, the Personal Consumption Expenditures price index, the Federal Reserve’s preferred inflation gauge, took its biggest 12-month leap since 1992.

The Labor Department is scheduled to release the May jobs report on Friday.