A new report from the Labor Department reveals that weekly jobless claims in the United States have fallen again — this time hitting a new 19-month low. According to this new data, claims fell about 6,000 to 290,000 the week that ended on October 16th. Meanwhile, continuing claims declined by 122,000 to 2.481 million.
This is now the second straight week where jobless claims have stayed below 300,000. A range of 250,000 – 300,000 signals that the labor market and economy are in a healthy position. Now, with this new data, it appears that the labor market is tightening. The nation is also currently experiencing a massive labor shortage. Therefore, businesses may be holding off on laying people off because of this shortage.
Filings did rise in certain states, however. California had a rise in 17,000 claims — though Kentucky, Michigan, New York, Pennsylvania, Texas, Virginia, and the District of Columbia all experienced big declines in jobless claims this past week.
At the end of October, when the monthly jobs report is released, analysts will be able to use this data to see just how the labor market is doing. Right now, the lack of workers may be keeping employers from laying off their workers. However, there is still a huge labor shortage that has left many businesses unable to perform at the level needed. In August, there were 10.4 million job openings — though a small number of hires occurred.
There are many reasons why people are not returning to the workforce. The COVID-19 pandemic has made a lot of Americans change their career path or retire, which has left certain industries without workers. Lingering COVID-19 concerns may still be keeping a lot of workers from returning to work.
Lack of efficient childcare is also a huge reason why many have not returned to work. Economists assumed that many would finally return to the workforce once school began in the fall, as parents would not have to look for childcare. However, this mass wave of hirings — which was initially expected — has not happened yet.
It still could, though. Some schools didn’t begin until September, so we might not see these hires occur until the October jobs report comes out.
Many businesses are also looking to hire a lot of workers before the holiday shopping season officially begins. These positions include seasonal or temporary workers, as well as part-time and full-time workers. Companies such as Walmart are looking to hire tens of thousands of workers before the holiday season to ensure their stores are fully stocked.
Global supply chain issues remain an issue for the United States. Ports are clogged with ships that need to be unloaded, a result of high consumer demand and a low amount of workers at the port. Ports — and individual companies — have struggled to meet the surge in demand this year amid this labor shortage. Now that employers have slowed down on laying workers off, these problems could lessen if more people are hired.
