With businesses reopening following the coronavirus lockdown, the Labor Department released a report on Thursday showing a continued decrease in first-time claims for U.S. unemployment benefits in the week ended June 6th.
The report said initial jobless claims tumbled to 1.542 million, a decrease of 355,000 from the previous week’s revised level of 1.897 million.
Economists had expected jobless claims to slump to 1.550 million from the 1.877 million originally reported for the previous week.
Jobless claims declined for the tenth straight week after reaching a record high of 6.867 million in the week ended March 28th.
Nonetheless, the number of new claims for unemployment benefits since the coronavirus lockdown now exceeds 44 million.
The Labor Department said the less volatile four-week moving average also dropped to 2,002,000, a decrease of 286,250 from the previous week’s revised average of 2,288,250.
Continuing claims, a reading on the number of people receiving ongoing unemployment assistance, also slid by 339,000 to 20.929 million in the week ended May 30th.
The four-week moving average of continuing claims fell to 21,987,500, a decrease of 404,750 from the previous week’s revised average of 22,392,250.
With jobless claims still at an elevated level, Paul Ashworth, Chief U.S. Economist at Capital Economics, said it is “hard to square the claims figures with the much more upbeat news on the labor market from May’s Employment Report.”
Last Friday, the Labor Department released a separate report unexpectedly showing a substantial rebound in employment in the month of May.
The Labor Department said non-farm payroll employment jumped by 2.51 million jobs in May after plummeting by a revised 20.69 million jobs in April.
The record spike in employment came as a shock to economists, who had expected the loss of another 8.0 million jobs following the nosedive of 20.5 million jobs originally reported for the previous month.
Employment rose sharply in leisure and hospitality, construction, education and health services, and retail trade, according to the Labor Department.
With the unexpected rebound in employment, the Labor Department said the unemployment rate dropped to 13.3 percent in May from 14.7 percent in April. Economists had expected the unemployment rate to surge up to 19.8 percent.
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