The Department of Labor reported Thursday that U.S. jobless claims rose by 23,000 to 230,000 last week. The four-week moving mean, which smooths out any week-to-week fluctuations, rose by nearly 6,300 to almost 21,000
Weekly applications, which are a proxy for layoffs and have increased in four of five weeks since last year’s coronavirus recession. This is a time that coincides with the spread of the Omicron variant. Despite the coronavirus recession last year, the job market has rebounded strongly. For about a year, jobless claims have been falling steadily and fell below the average weekly rate of 220,000 per week before the pandemic.
According to Oxford Economics economists Nancy Vanden Houten (left) and Kathy Bostjancic (right), “The increase in claims probably reflects an increased number of layoffs caused by the surge in COVID case,” said Nancy Vanden Houten (right). Although claims may be elevated for the near future, we anticipate initial claims to return to the 200k mark once the omicron wave is over. It is encouraging to see that cases from the Omicron variant are peaking.
In total, 1.6 Million people received jobless assistance in the week ending Jan. 1.
Employers are keeping their workers in a difficult time where it is hard to find new employees. In November, employers posted 10.6 millions job openings. This is the fifth-highest monthly total since 2000. In November, 4.5 million workers quit their jobs — a record number that shows they are ready to change.
After last year’s coronavirus-induced recession, the job market has rebounded. COVID-19 was a devastating virus that caused governments to order lockdowns. Consumers hunkered down at their homes, and many businesses shut down or reduced hours. In March 2020 and April 2020, employers cut millions of jobs and the unemployment rate soared to 14.7%.
However, the economy was reborn after massive government spending and the eventual rollout of vaccines. Although employers created a record number of jobs last year, it was still not enough to replace the 9.4 million jobs that were lost in 2020, Employers struggled to fill open positions, which led to a slowdown in hiring.
However, unemployment fell to 3.9% last month, a low that is considered a pandemic.
