An employer provides information to job seekers during a job fair in Miami, Florida, on December 16, 2021.
Eva Marie Uzcategui / Bloomberg via Getty Images
Initial jobless claims end in 2021 near pre-pandemic levels, after an improving labor market caused claims to drop about four times during the year.
However, an increase in the number of Covid-19 cases amid the spread of the highly contagious omicron variant risks having a negative impact on the labor market as early as 2022.
The original claim is a proxy for benefits applications after decommissioning. Americans filed 198,000 jobless claims last week, on a seasonally adjusted basis, the Department of Labor speak Thursday, its last update before the new year. That level is slightly higher than Lowest in 52 years hit earlier in December.
The average initial claim was 199,250 a week in December – four times less than the 849,000 average at the start of the year (January 2021) and well below the pre-pandemic average of 225,000 in December 2019 , according to an analysis of data from the Federal Reserve Bank of St. Louis.
Overall, the reduction in claims leads to fewer layoffs.
“With job opportunities like high As they are, and so many employers are scrambling to retain and/or add staff, job security can be seen as one of the gifts of the current holiday season, at least from a scores of workers,” Bankrate senior economic analyst Mark Hamrick said in an analysis of jobless claims earlier this month.
Severance workers may also be ineligible to apply for unemployment benefits if they have recently received – and exhausted – state aid following previous layoffs. The move may somewhat mute the weekly claims figures, though the magnitude of it is unclear.
Federal pandemic-era benefit programs, which extend aid beyond the traditional 26-week maximum, ended on Labor Day. They also offered an extra $300 a week.
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The U.S. unemployment rate fell “further and faster” than expected, follow for Jason Furman, an economist at Harvard University and economic adviser to former President Barack Obama.
The unemployment rate of 4.2% in November was the shortest as of February 2020.
Furman noted that the ratio of jobless workers to jobs in November was 0.6, the lowest on record. Employment growth is also very strong in 2021, with the economy adding 555,000 jobs per month on average, since last December, roughly matching expectations, he said.
However, the economy is still close to 4 million jobs due to the pre-pandemic footprint, follow for the Bureau of Labor Statistics.
Furman said the supply of workers was also “disappointing”. About 2.4 million won less than workers who were in the relative labor force as of February 2020.
The “real” unemployment rate, adjusted for declines in labor force participation and other factors, is 5.4%, or 1.9 percentage points, above pre-pandemic levels, Furman said.
It is unclear whether labor market trends will continue in the coming weeks and months, with a surge in the case of the highly contagious Covid omicron variant. Restaurants, entertainment venues and other businesses closed because infections among employees have caused labor shortages.
