Latest News

Economic Report: U.S. unemployment claims drop 23,000 to 238,000 as omicron wave relents


The numbers: New requests for U.S. unemployment benefits fell for the second week in a row to 238,000, as the record omicron wave receded and more people were able to go back to work.

Initial jobless claims declined by 23,000 from a revised 261,000 in the prior week, the Labor Department said Thursday.

Economists polled by The Wall Street Journal had forecast initial jobless claims to total a seasonally adjusted 245,000.

Big picture: The economy was walloped last month by the fast-spreading omicron strain of the coronavirus. Almost 9 million people missed time from work, another government report found. 

Payroll processor ADP said companies shed 301,000 jobs in January to mark the biggest decline since the first month of the pandemic in early 2020. The government on Friday is also expected to report tepid hiring or even an outright decline in employment.

Coronavirus cases are now falling fast, however, and most people who were absent from work are returning to their jobs. Employment should rebound in February.

Even so, businesses are still grappling with a broad labor shortage that existed before omicron and is likely to persist.

Key details: New jobless claims soared to as high as 290,000 early last month owing to the omicron outbreak. They had fallen to as low as 188,000 in December and hit a 52-week low.

Now they are declining again. New claims fell the most last week in Ohio, Kentucky and Illinois. The only state to post a sizable increase was Pennsylvania.

The number of people already collecting unemployment benefits, meanwhile, slipped by 44,000 to 1.63 million. These so-called continuing claims have returned to pre-crisis levels and are extremely low.

Looking ahead: “The recent rise in covid cases propped up claims, but that increase is unwinding quickly as the omicron wave recedes,” said lead U.S. economist Nancy Vanden Houten of Oxford Economics.

Market reaction: The Dow Jones Industrial Average DJIA, +0.63% and S&P 500 SPX, +0.94% were set to open lower in Thursday trades.

Why Facebook parent Meta’s stock is getting crushed

Previous article

Europe Markets: U.K. bond yields spike as Bank of England hikes and ECB stands pat

Next article

You may also like


Leave a reply

Your email address will not be published. Required fields are marked *

More in Latest News