A bipartisan group of members of Congress announce a proposal for a Covid-19 relief bill on Capitol Hill in Washington DC on Tuesday. New applications for US jobless benefits fell to 712,000 last week, a better-than-expected decline of 75,000. – AFPPIXA drop in new applications for US unemployment benefits offered small comfort to the millions of Americans who will see pandemic aid expire without an agreement in Congress on a new relief programme.
Economists had been anticipating the number of new claims to hold steady after spiking in the week ended November 21 to an upwardly revised 787,000. The fate of those programmes remains uncertain as Congress has yet to break the impasse over a new federal relief plan that can be approved in the"lame duck" session before Biden takes charge of the White House.
Amid continued signs the labour market recovery has stalled, as surging Covid-19 cases has prompted more business restrictions, the big drop in jobless claims could be a blip since the data are for the week that include the Thanksgiving holiday, which could skew the figures. Rubeela Farooqi, chief US economist at High Frequency Economics, highlighted the danger posed by the potential for rising layoffs in coming weeks."The hit to household balance sheets from job and income loss as well as expiring federal benefits is a downside risk for spending going forward."