The COVID-19 pandemic’s continued impact on the labor market was highlighted Thursday morning when the U.S. Labor Department released its weekly initial jobless claims report.
Another 2.981 million Americans filed for unemployment benefits in the week ending May 9 surpassing economists’ estimates for 2.5 million jobless claims for the week. The prior week’s figure was revised higher to 3.18 million from the previously reported 3.17 million jobless claims. Over the past two months, more than 36 million Americans have filed unemployment insurance claims.
Continuing claims, which lags initial jobless claims data by one week, totaled a record 22.83 million in the week ending May 2 following 22.38 million continuing claims in the prior week.
The weekly number of jobless claims has been steadily declining even as the cumulative number remains high.
“Although initial jobless claims were still as high as 2,981,000 in the week ending 9th May, the relatively modest increase in continuing claims in the week before that suggests the number of people returning to work, as the lockdowns were eased, was nearly as high as the number of people losing a job,” Capital Economics wrote in a note to clients Thursday.
In the week ending May 9, the Labor Department reported that Connecticut had an estimated 299,000 jobless claims, up significantly from 36,000 in the prior week. However, Connecticut’s Department of Labor tweeted shortly after the report was released that there was a data error. The correct number should have been 29,846.
Georgia reported the highest number of jobless claims during the week at an estimated 241,000 on an unadjusted basis, up from 228,000 in the previous week. Florida had 221,000, California reported 214,000 and New York had roughly 200,000 jobless claims.
Negative economic impact caused by the coronavirus has been broad-based, and the U.S. labor market has been deteriorating at a rapid clip.
Thursday’s weekly jobless claims comes on the heels of April’s dismal jobs report that showed the U.S. economy lost 20.5 million jobs during the month as a result of COVID-19. The steep drop in payrolls in April was the worst on record going back to the start of data in 1939, and the unemployment rate surged to 14.7% from 4.4% in March.
Nevertheless, economists argued that while the headline figures were staggering, most of the job losses due to the global pandemic are likely temporary, and as states slowly move toward reopening their economies, the path forward is what matters most.
“In our view, while these results are unprecedented, the way forward is what matters for investors,” Oppenheimer Asset Management Chief Investment Strategist John Stoltzfus wrote in a note May 8. “As many states and localities reopen for business, hiring should resume and the economy should begin to revive. Still, the challenge for policymakers is to minimize permanent job losses where possible.”
As of Thursday morning, there were more than 4.3 million coronavirus cases and 297,500 deaths worldwide, according to Johns Hopkins University data. In the U.S., there were 1.39 million cases and 84,100 deaths.
Heidi Chung is a reporter at Yahoo Finance. Follow her on Twitter: @heidi_chung.
More from Heidi: