Jobless claims rise slightly but hover near pandemic low

The number of Americans filing new jobless claims increased slightly but hover around the pandemic-era low last week despite an increase in delta variant cases of COVID-19 in the country.

The Labor Department said Thursday that initial jobless claims increased to 332,000 last week, up from a historic low of 310,000 the previous week.

Layoffs caused by Hurricane Ida, which slammed Louisiana at the end of August, looked to contribute to the surge in minor claims, according to WSJ economists.

Last week, the four-week moving average, which smooths down frequently erratic data, plummeted to 335,750, a new pandemic low.

The last time claims were this low was March 14, 2020, shortly before the Covid-19 pandemic outbreak, which plunged the United States into its worst but briefest recession on record.

In the second quarter, the economy increased at an annualized pace of 6.5 percent. The Atlanta Federal Reserve now expects GDP to rise at a 6.0 percent annual rate in the third quarter.

The rate within the 200,000-250,000 range is viewed as consistent with healthy labor market conditions.

Before the pandemic, in March 2020, the initial filings had been trending around 215,000. At its peak, the filings claim hit 6.1 million in early April of the last year.

The worries around the employment picture have escalated in recent weeks after the Labor Department reported that nonfarm payrolls increased 235,000 in August, after surging 1.053 million in July. The growth fell short of Wall Street’s expectation of 720,000.

Consistent bottlenecks in the supply chain are also generating shortages of items such as automobiles and various home appliances, reducing retail sales.

In a separate report, Retail sales increase in August by 0.7 percent as demand for products remained robust despite the growing concerns of delta variant, Commerce Department said.