Weekly Jobless Claims Fall to a New 52-Year Low

The Labor Department released their new report early because of the Thanksgiving holiday, revealing that weekly jobless claims in the United States have now fallen to a new 52-year low. Claims fell by another 71,000 the week that ended on November 20, to about 199,000 claims altogether. These are the lowest weekly claims since November of 1969. 

While the economy has been strengthening as the labor market struggles to recover after the COVID-19 pandemic, economists have been wary about job hires and jobless claims. Previously, the jobless claim this week was forecast to still be in the 250,000 to 260,000 range. Obviously, economists didn’t anticipate that claims would fall by more than 70,000. 

Jobless claims have fallen every week since October of 2021. Claims previously hit a record high earlier last year as the pandemic first began, as 6.149 million people filed for unemployment in April of 2020. Now, claims have finally hit the range that is normally expected with a healthy labor market.

Weekly claims have continued to fall for the past few months. This could possibly be a result of the labor shortage the country is still dealing with. While more hires have been recorded in the past month, there are still a lot of people in the country who have not returned to the workforce, for a variety of reasons. There are still about 3 million people who worked before the pandemic began who have not returned to the workforce.

This is likely for a lot of reasons. For one, there is a lot of people who have retired or have changed their career path as a result of the pandemic. Plus, there are still a lot of people who have lingering COVID concerns and do not yet want to return to work. However, we may see more people return to the workforce in the near future as federal government-funded benefits end. Schools have also reopened, which may help people return to work — even though we haven’t necessarily seen this happen yet. 

To get people to return to work, companies are also raising their wages and offering lucrative bonuses. As the holiday season is officially beginning with this upcoming week, many employers for the past few weeks struggled to find the accurate number of workers to help with their anticipated holiday rush. To get workers for all aspects of their company, employers offered much higher hourly wages and seasonal bonuses. 

This latest Labor Department report also seems to hint that the fourth quarter will see a surge in economic activity and growth again after the economy slowed down a bit in the third quarter because of the Delta variant and consistent material and labor shortages. Now, as companies prepare for the holidays, the fourth quarter is expected to be very beneficial for many businesses — and for the economy as a whole. Already, sales surged in October as many Americans started their holiday shopping early to try to beat any supply chain problems they may face towards the end of the month.