WASHINGTON: The number of Americans filing new claims for unemployment benefits fell below 1 million last week for the second time since the COVID-19 pandemic started in the United States, but that does not signal a strong recovery in the labor market.
Initial claims for state unemployment benefits fell 130,000 to a seasonally adjusted 881,000 for the week ended Aug. 29. Economists polled by Reuters had forecast 950,000 applications in the latest week. Private employers hired fewer workers than expected in August. In addition, data from Kronos, a workforce management software company, and Homebase, a payroll scheduling and tracking company, showed employment growth stagnated last month.
According to a Reuters survey of economists nonfarm payrolls likely rose by 1.4 million jobs last month after increasing by 1.763 million in July. That would leave nonfarm payrolls about 11.5 million below their pre-pandemic level. "It is sobering to think, four months after the worst month of the lockdown recession, the number of people receiving assistance remains millions higher than at any time prior to the pandemic," said Chris Low, chief economist at FHN in New York.