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These states are enduring the worst unemployment rates

The number of jobs lost due to the coronavirus shutdown continue to mount, with the latest weekly total of Americans applying for unemployment benefits topping 880,000. Yahoo Finance's Emily McCormick and Zack Guzman break down the details.

Video Transcript

ZACK GUZMAN: The uptick that we got on the unemployment from here is weekly jobless numbers were released from the Department of Labor earlier this week would also not seem to indicate what sparked the sell-off, since those numbers came in better than expected. The weekly update we got from the Department of Labor showed that initial jobless claims came in better than expected at just over 880,000 new claims. That marks just the second time since the pandemic hit the US that we've seen weekly jobless claims come in below the one million dollar mark.

Joining us now for more on that report is Yahoo Finance's Emily McCormick. And, Emily, I mean, this is also the first time we're seeing the report from the Department of Labor come out since they've tweaked their reporting metrics on claims. So what does this say about the direction the job recovery is headed in now?

EMILY MCCORMICK: Well, Zack, some conflicting signs that we're actually getting from this latest report from the Department of Labor because of those changes that you mentioned. But to reiterate the headline figures here-- we did see initial jobless claims for the week ended August 29 at 881,000-- those better than the 950,000 that had been expected, and did mark a new low in new claims during the pandemic period.

Now, we also saw continuing claims for the week prior, ended August 22, at 13.25 million-- better than the 14 million expected-- so beat on both counts there. Now, one big caveat in this morning's report, and that's that the Department of Labor has now begun counting seasonally adjusted new and continuing claims-- that's those headline figures-- under a new system. So to adjust for seasonal hiring, things like retail workers entering and leaving the workforce around the holiday season and other examples of workers like that, the Labor Department is now using an additive system rather than a multiplicative one.

And that's to try and make the seasonally adjusted level of new claims better reflect the impact from the pandemic since these layoffs, of course, have been inflated by the pandemic and broke from the typical seasonal work patterns that we've seen in years past. Now, this change, in short, was expected to lower the number of reported jobless claims on a seasonally adjusted basis last week, which it did. And it also now makes it unhelpful to compare these results to previous week's results on that seasonally adjusted basis.

Now, the change did not, of course, affect unadjusted new claims. Those actually rose by about 7,600 to 833,000 for the week ending August 29. That's actually the third straight week that we've seen unadjusted new claims rise-- so a bit less of an upbeat trend here in that pocket of the data.

Now, taking a look at those unadjusted claims by state, while most states did report week on week declines in their number of new claims, we did see California breaking from this trend, with that state reporting an increase of nearly 40,000 unadjusted new jobless claims, and that brought its one week total to about 237,000.

Now, with this data in tow, this, of course, is coming to, really, one day now before the Department of Labor's monthly jobs report. We'll be getting that out for August tomorrow morning before the bell. Consensus economists are still looking to see non-farm payrolls increasing by about 1.35 million for the month. That would be a step down from what we saw for July, but still seeing net job gains for the economy as we do have businesses continuing to reopen, Zack.