US initial jobless claims fall below 1 million, but layoffs remain elevated

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US initial jobless claims fall below 1 million, but layoffs remain elevated

US Labour Department data released on Thursday had revealed that the number of Americans having been forced to be laid-off due to the pandemic-led fiscal pandemonium for the first time on their lives, had fallen to the lowest levels since the onset of the pandemic outbreak, however, a higher layoffs in parallel has been suggesting that the outbreak has still enough steam to weaken the US labour market for several months, if not years.

In point of fact, the US Labour Department said in a statement earlier on the day that the number of laid-off Americans applying for the unemployment benefits dipped to 881,000, remarking the index’s third below 1-million reading over the past six months, however, analysts suggested that the economy had still been vying to vent out a clear line of sight towards a solid economic recovery.

US initial jobless claims had been above 1-million level last week. Aside from that, Govt. data had also unveiled on Thursday that the continuing claims had stepped up to 13.3 million from a month earlier, signalling that a tepid recovery in US Labour market.

Notably, before the onset of the pandemic outbreak in the United States, initial jobless claims had never surpassed a 700,000 level. Besides, the US economy had been able to recover only 42 per cent of the jobs shrugged off during the peak of the pandemic outbreak.

US Labour market struggles; continuing claims hover above 13mn

Although, Thursday’s US unemployment reading has been the lowest since mid-March while the pandemic had paralyzed the US economy, still US jobless claims remained at a historically high, while a rise in continuing claims hinted that a quicker-than-anticipated labour market recovery could be a far cry at this standpoint.

Meanwhile, as many Wall St. economists and analysts have been warning that a mass layoff wave would unlikely to ease off unless a feasible existence of a Government stimulus plan, echoing the leads of US Fed’s July FOMC report that forecasted a malevolent slowdown in US labour market recovery at least until mid-2021, economists of Oxford Economics wrote in a client followed by the release of Thursday’s jobless claims data, “The data show that layoffs remain widespread and the recovery in the labor market is occurring at a frustratingly slow pace.