The number of Americans applying for unemployment benefits fell to its lowest level since the pandemic began, a sign the job market is still improving even as hiring has slowed in the past two months.
What You Need To Know
- The number of Americans applying for unemployment benefits fell to its lowest level since the pandemic began, a sign the job market is still improving even as hiring has slowed in the past two months
- Unemployment claims dropped 36,000 to 293,000, the second straight drop, the Labor Department said Thursday
- That’s the smallest number of people to apply for benefits since March 2020, when the pandemic intensified
- President Joe Biden praised the figure as a promising sign of economic recovery and touted vaccine mandates and declining COVID-19 cases as responsible, but called for Congress to pass his key economic agenda for this economic recovery and growth to continue in earnest
Unemployment claims dropped 36,000 to 293,000 last week, the second straight drop, the Labor Department said Thursday. That's the smallest number of people to apply for benefits since March 2020, when the pandemic intensified. Applications for jobless aid, which generally track the pace of layoffs, have fallen steadily since last spring as many businesses, struggling to fill jobs, have held onto their workers.
"Today, we learned that the number of Americans filing new claims for unemployment has fallen below 300,000 for the first time since the pandemic began — a drop of more than 60 percent since I took office, and the lowest weekly figure since March 14, 2020," President Joe Biden said in a statement on Thursday. " While this is just one week, the fact that the four-week average declined is yet another sign of progress."
Biden said that "we cannot fully bring our economy back unless we beat the pandemic," but noted that "we are seeing encouraging signs," including attributing some success to vaccine mandates.
"As vaccination requirements have gone into effect, more and more Americans are getting vaccinated," Biden said. "In fact, we now have 66 million eligible Americans that are unvaccinated, down from almost 100 million in July. We are making important progress against the Delta variant, and our economy is gaining strength in turn."
Hiring has slowed in the past two months, even as companies and other employers have posted a near-record number of open jobs. Businesses are struggling to find workers as about three million people who lost jobs and stopped looking for work since the pandemic have yet to resume their job searches. Economists hoped more people would find work in September as schools reopened, easing child care constraints, and enhanced unemployment aid ended nationwide. But the pickup didn't happen, with employers adding just 194,000 jobs last month.
In a bright spot, the unemployment rate fell to 4.8% from 5.2%, though some of that decline occurred because many of those out of work stopped searching for jobs, and were no longer counted as unemployed.
"With wages rising and our unemployment rate back below 5 percent for the first time since the pandemic struck, it is clear that our economy is getting back to normal despite the global challenges posed by the Delta variant," Biden said.
At the same time, Americans are quitting their jobs in record numbers, with about 3% of workers doing so in August. Workers have been particularly likely to leave their jobs at restaurants, bars, and hotels, possibly spurred by fear of the delta variant of COVID-19, which was still spreading rapidly in August.
Other workers likely quit to take advantage of higher wages offered by businesses with open positions, or left jobs because child care for children too young to go to school has been harder to find.
Biden said that with COVID cases and unemployment claims dropping, "it is clearer than ever that America is in the midst of an historic economic recovery — one that continues to lead the world."
"The first half of this year saw our economy grow at the fastest rate in four decades," Biden noted. "The last three months have seen the largest fall in long-term unemployment since we began keeping records in 1948. And with an average of 600,000 new jobs created each month since I took office, we have dramatically outpaced the previous record of job growth under a new president."
But, the president said, for this economic recovery and growth to continue in earnest, "it is critical that we take action now to invest in our nation and our people" — specifically calling for Congress to pass the two key pillars of his economic agenda: The Senate-passed $1 bipartisan infrastructure bill, and the larger Build Back Better act which aims to expand the social safety net.
"We must pass both the Bipartisan Infrastructure Act and the Build Back Better Act to strengthen the foundations of our economy, revitalize our middle class, and position America to compete and win for decades to come," Biden said.