US weekly jobless claims tumble to new COVID low of 473,000

Jobless claimsBryan Woolston/ReutersHundreds of people lined up outside a Kentucky Career Center hoping to find assistance with their unemployment claim in Frankfort, Kentucky, on June 18, 2020.
  • US jobless claims sank to 473,000 last week, marking the fourth decline in five weeks.
  • Economists expected claims to total 490,000. The prior week’s count was revised higher to 507,000.
  • Continuing claims dropped to 3.66 million for the week that ended May 1, just above estimates.
  • See more stories on Insider’s business page.

The number of Americans filing for unemployment benefits dropped once again as the US economy reopened further.

New jobless claims totaled an unadjusted 473,000 last week, the Labor Department said Thursday. That was lower than the median estimate of 490,000 from economists surveyed by Bloomberg.

The reading marks the fourth decline in five weeks and places claims at their lowest since the pandemic froze economic activity in March 2020. The previous week’s reading was revised to 507,000 from 498,000.

Continuing claims, which track Americans currently receiving unemployment benefits, dropped to 3.66 million for the week that ended May 1. That came in just above the median estimate of 3.65 million.

Claims have steadily declined in recent weeks as the economy moves closer to fully reversing its pandemic restrictions. Weekly counts trended above 700,000 for most of the crisis before the latest string of declines, which suggests Americans are either exiting unemployment-insurance programs or getting hired. Still, weekly totals remain roughly double their pre-pandemic norm of about 200,000.

The Thursday data is the first to come after the hugely disappointing April jobs report. The US added 266,000 nonfarm payrolls last month, significantly missing the median estimate of 1 million payrolls and showing a sharp deceleration from the job growth seen in March. The data raised questions around just how strong the labor market’s recovery would be through the rest of 2021.

Experts cited a handful of factors for the huge payrolls miss. Virus fears most likely kept some Americans on the sidelines, particularly those who would be returning to service-industry jobs. The end of the school year and lack of affordable childcare may have forced some to stay home instead of reentering the work force.

Lawmakers have argued whether the $300 weekly boost to unemployment benefits provides another disincentive to work. While Democrats see the policy as a key support for millions of unemployed Americans, Republicans have said the benefit is paying people to avoid looking for jobs.

Elsewhere in labor-market data, job openings surged to a record-high 8.1 million in March as businesses looked to hire through reopening. The hiring rate rose to 4.2% from 4%, and separations – which count layoffs and quits – declined to 5.3 million from 5.4 million. Though the report doesn’t include April data, it shows strong demand for workers just ahead of the lackluster jobs report.

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