US Unemployment Claims Rise From 31,000 To 742,000 Amid Record Rise Of Coronavirus

The latest coronavirus outbreak threatens to lead to more layoffs and job losses. saul loeb / Agence France-Presse / Getty Images

The numbers: New claims for state unemployment benefits in the United States spiked in mid-November for the first time in more than a month, pointing to additional stress on the economy from a record spike in coronavirus cases.

Initial jobless claims increased by 31,000 to 742,000 seasonally adjusted in the seven days ending Nov. 14. Economists surveyed by MarketWatch had predicted that initial jobless claims would total 710,000.

Another 320,237 people applied for benefits through a temporary federal aid program that expires at the end of the year, the government said Thursday.

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What Happened The combined number of new state and federal jobless claims has yet to drop below 1 million per week since the start of the pandemic.

Meanwhile, the number of people already receiving state-provided benefits dropped by 429,000 to 6.37 million seasonally adjusted in the week ending Nov. 7. This is known as continuing claims.

Continuing federal claims increased by 233,458 unadjusted to 4.38 million in the week ending October 31, the latest data available.

The number of people receiving these federal benefits has more than tripled since August, underscoring the fragile nature of the job market. A growing number of workers are still unable to return to work and face permanent loss of their jobs. Others simply cannot find anything available.

In total, the number of people receiving benefits from eight separate state and federal programs decreased by 841,245 to 20.3 million unadjusted as of October 31. It’s unclear how many people exhausted benefits or found work.

Some economists question the accuracy of the total estimate, as other government data indicates that unemployment is significantly lower.

Read: Not again! The economy faces another tough challenge from the coronavirus

The Big Picture: The economy has been steadily picking up jobs since a huge hiring explosion when the US reopened in May, but the record spike in coronavirus cases threatens to freeze or even partially undue progress if more cities and states impose restrictions on business.

The United States continues to lose about 10 million jobs that were lost during the early stages of the pandemic, and unemployment remains very high. Extended federal unemployment benefits will also run out at the end of December unless Democrats and Republicans break a months-long stalemate over the next aid package.

What they are saying “The spike in claims is a sign of the impact that new closures and restrictions are having on the labor market,” said senior economist Jennifer Lee of BMO Capital Markets.

“The combination of record coronavirus cases and the post-holiday winter months will likely be a bleak time for the job market,” said AnnElizabeth Konkel, an economist at Indeed Hiring Lab. “Losing unemployment benefits right after the holidays alone it will increase the economic pain already felt by millions. ”

Market Reaction: The Dow Jones Industrial Average DJIA, -0.74% and S&P 500 SPX, -0.67% fell slightly in Thursday’s trading.