US weekly jobless claims near 18-month low as labour market recovery gathers pace

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US weekly jobless claims near 18-month low as labour market recovery gathers pace

On Thursday, US Labour Department said in a statement that the number of Americans applying for state unemployment benefits for the first time on their lives fell to the lowest since mid-March last week, adding further evidence that August nonfarm payrolls miss was largely due to a chronic labour shortage instead an ease in labour demands.

Apart from that, US Labour Department’s latest weekly jobless claims data also had revealed that the number of people having been on jobless benefits fell to the lowest level in more than 18 months, when US economy was grappling with a compulsory business shutdown after WHO (World Health Organization) had docketed the Covid-19 crisis as a pandemic on March 11, 2020.

On top of that, latest downward spiral in US initial jobless claim comes over the heels of a Labour Department JOLTS report that said on Wednesday that US job openings had spiked to record for a fifth successive month on July, leading to analysts’ belief that a latest lag in US job growth was mostly catalysed by a labour shortage.

US initial jobless claims fall to 18-month low at 310,000 last week

According to US Labour Department data, US initial jobless claims fell 35,000 to a seasonally adjusted 310,000 during the week that ended on September 4, the lowest level since mid-March, beating an analysts’ estimate of 335,000 applications, while on an unadjusted basis, initial jobless claims fell 8,005 to 284,287 last week, nearing a 200,000-250,000 range what is often contemplated as a salubrious US labour market.

Besides, continuing claims indented 22,000 to 2.783 million after hitting a record 6.149 million on early-April, 2020. Meanwhile, referring to a persistent healing in US labour market, a chief economist at FWDBONDS in New York, Chris Rupkey said, “There is likely to be a fierce debate at the coming Fed meeting on how tight the labor market is, but if policymakers focus on the most timely data we've got, they will realize that the labor market is close to meeting their more stringent criteria for an interest rate hike let alone the trigger for tapering”.