March 8, 2021

U.S. Jobless Claims Increased by Striking Verizon Workers

Initial claims for state unemployment benefits rose 5,000 to a seasonally adjusted 417,000, the Labor Department said. Analysts see 400,000 as the level where the economy is creating net new jobs.

Striking Verizon workers filed 8,500 claims for jobless benefits last week, after submitting 12,500 applications the previous week, which covered the period for the August nonfarm payrolls survey.

That suggests that the strike would reduce the monthly payroll count, which will be reported on Sept. 2. The strike against Verizon ended on Monday.

Economists polled by Reuters had forecast claims would be 405,000 last week. The previous week’s claims were revised up to 412,000 from the previously reported 408,000.

The claims showed little sign that companies were laying off workers in droves in response to the recent tumble in share prices. Fears that the economy is on the brink of slipping back into recession have rattled stock markets, helping to lower business and consumer confidence.

While the labor market regained some ground in July, a new wave of layoffs, coupled with the deterioration in business sentiment, could reverse the trend in the months ahead.

Employers added 117,000 jobs in July after increasing payrolls by only 99,000 in May and June combined. The unemployment rate fell to 9.1 percent in July from 9.2 percent in June.

A Labor Department official said there was nothing unusual in the state-level data released Thursday. The four-week moving average of claims, considered a better measure of labor market trends, rose 4,000 to 407,500.

The number of people still receiving benefits under regular state programs after an initial week of aid fell 80,000, to 3.64 million, in the week ended Aug. 13.

The number of Americans on emergency unemployment benefits fell 43,827, to 3.09 million, in the week ended Aug. 6, the latest week for which data is available.

A total of 7.29 million people were claiming unemployment benefits during that period under all programs, down from 45,989 the previous week.

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