U.S. Initial Jobless Claims Total 2.43 Million in Latest Week

(C) Reuters.

By Noreen Burke

Investing.com – The number of Americans applying for initial unemployment benefits totaled 2.43 million in the week ending May 16, the U.S. Labor Department said Thursday, the smallest increase since March but still remaining at elevated levels.

It was broadly in-line with forecasts and was down from 2.68 million in the prior week. That figure was revised lower after Connecticut said it had misreported its numbers.

Claims have been gradually decreasing since hitting a record 6.86 million in the week ended March 28.

The latest filings bring the number of people who filed claims for unemployment benefits to around 38.6 million since March 21.

The data reinforced economists’ expectations for another month of historic job losses in May. Statewide lockdowns starting in mid-March to contain the spread of COVID-19, the respiratory illness caused by the coronavirus have severely undermined the labor market and the wider economy.

The economy lost a staggering 20.5 million jobs in April, the steepest plunge in payrolls since the Great Depression.

Continuing claims, which show the number of people receiving benefits after an initial week of aid increased to a new record of 25.07 million in the week ended May 9, the report said, up from 22.54 million a week earlier.

Continuing claims figures are reported with a one-week delay but are considered a better gauge of the labor market.

Continuing claims could offer some clues on how quickly businesses rehire workers as they reopen. They can also gauge companies’ ability to get people off unemployment or keep workers on payrolls as they access the government’s Paycheck Protection Program, which offered loans that could be partially forgiven if they were used for employee salaries.

“Most recently, continuing claims have plateaued and suggest that we could be seeing an early sign that employers are calling back employees as states begin to re-open,” said Sam Bullard, a senior economist at Wells Fargo Securities in Charlotte, North Carolina. “Focus should continue to center on continuing claims, which provide a better idea of the challenges unemployed workers face and also some insight into the hit to GDP growth.”

–Reuters contributed to this report