First jobless claims jumped to 965,000 last week, amid signs of a slowdown in hiring due to pandemic restrictions, the Labor Department said on Thursday.
The total was worse than Wall Street’s estimates of 800,000 and above the previous week’s total of 784,000.
The markets reacted little to the number, since the drop in economic activity should be welcomed with more stimulus from Washington. President-elect Joe Biden on Thursday is announcing his hopes for another package likely to exceed $ 1 trillion.
Futures prices continued to indicate fractional opening gains on Wall Street.
Still, the number of unemployed in the week ending January 9 was another sign of economic turmoil brought about by restrictions on activities designed to combat the pandemic. The total was the highest since the week of August 22, when just over 1 million complaints were registered.
Continuous claims were also higher, increasing 199,000 to 5.27 million. That number is a week behind total weekly complaints and has increased for the first time since late November.
The total number of people receiving government benefits has decreased dramatically, despite the increase in weekly numbers. That level dropped to 18.4 million from 19.2 million the previous week. The data is two weeks behind the total weekly complaints. The reduction came mainly from a drop in emergency pandemic claims, although it remains well above the 2.18 million who received benefits a year earlier.
The increase in claims has spread to a handful of states, especially those with stricter business restrictions.
Illinois, where Chicago restricted restaurants, had a jump of 51,280, according to unadjusted data. Other big winners were California, which doesn’t even allow outdoor dining and saw its number of complaints increase by 20,587, an increase of 13%. New York increased by 15,559.
However, several states with relatively loose restrictions have also seen remarkable gains. Florida saw its claims more than double to 50,747, while Texas saw an increase of 14,282.
Signs have lately surfaced that job gains that started in May have started to cool.
In December, non-farm payrolls fell for the first time during the recovery from Covid market lows, falling by 140,000, while the unemployment rate remained at 6.7%.
The Federal Reserve said on Wednesday that business contacts in all 12 central bank districts reported reduced hiring and difficulty filling vacancies. Economists often see the 2021 economy as starting slowly, but gaining momentum as the year progresses and the Covid-19 vaccine spreads.