First jobless claims fell suddenly last week amid signs that hiring has increased in the U.S. economy, the Department of Labor reported on Thursday.
Complaints totaled 684,000 in the week ending March 20, the first time the number had dropped below 700,000 during the Covid-19 era. The level represented a substantial decline from 781,000 a week ago and was the lowest since March 14, 2020, just when the pandemic had started.
Economists consulted by Dow Jones expected the claims to total 735,000.
A separate statement on Thursday morning showed that gross domestic product was stronger than anticipated in the fourth quarter. The third and final GDP reading showed a 4.3% gain, above previous estimates and the 4.1% Wall Street consensus.
Policymakers have been looking at job data more closely, however, looking for clues as to where the economy is heading.
Last week’s progress showed that the job market is gaining momentum amid aggressive government stimulus and a vaccination program that is taking about 2.5 million Americans getting vaccines a day with the goal of preventing the spread of Covid -19.
The most recent weekly complaints also marks the first time that the total is less than the pre-pandemic record of 695,000 that occurred in early October 1982.
In addition to the drop in weekly claims, continuous claims, with a one-week delay, fell to 3.87 million, down 264,000.
The total number of people who received benefits reached almost 19 million, although the data is two weeks behind the number of complaints. A continued decline in the number of people receiving assistance through special programs for the pandemic era is likely to reduce the total in the coming weeks.
Wall Street continued to indicate a lower opening, despite better-than-expected job news.
Although the number of claims in general remains high by historical standards, the employment situation is markedly better than it was a year ago.
For the week ended March 21, 2020, claims totaled 3.3 million and would explode to almost 6.9 million a week later, with companies laying off workers amid a wave of government-ordered shutdowns across the country. parents.
Weekly claims would not drop to less than 1 million by the end of August, and 22.4 million workers would lose their jobs in March and April alone. Almost 13 million of those jobs have been recovered since then.
Despite the stronger employment picture, Federal Reserve Chairman Jerome Powell indicated on Thursday that the central bank will continue its aggressive policies to keep growth up.
“We will go very, very gradually over time and with great transparency, when the economy is fully recovered, we will be withdrawing the support we provide during times of emergency,” Powell told NPR’s “Morning Edition”.