Last week, the number of Americans filing new unemployment claims dropped to a 13-month low, indicating that layoffs were subsiding and raising hopes for another month of record job growth in April, as the economy reopens and pent-up demand is released. Although the job market is improving, concerns are growing about the housing market, which was the economy’s star performer during the Covid-19 pandemic. Other data released on Thursday showed that sales of previously owned homes fell to a seven-month low in March, as prices rose to a record high despite a severe housing shortage. Realtors cautioned that high-priced homes might become a permanent aspect of the economy, resulting in increased inequality.
Despite the fact that the economy is thriving and job market wounds are recovering due to substantial federal assistance and expanded Covid-19 vaccines, 17.4 million individuals are already receiving unemployment benefits. “We’re seeing claims decline in most states, indicating that the employment rebound has broadened nationally,” said Robert Frick, corporate economist at Navy Federal Credit Union in Vienna, Virginia.
“However, an increasing percentage of Americans are out of jobs for longer periods of time, and it is these individuals that are more difficult to reintegrate into the labour force”, added Frick. The labour department reported that initial claimants for state unemployment insurance fell 39,000 to a seasonally adjusted 547,000 for the week ending April 17, the lowest level since mid-March 2020.
Reuters polled economists, who predicted 617,000 applications for the most recent week. It was the second week in a row that claims fell below 700,000, the lowest number since March 2020, when non-essential companies such as restaurants and bars were forced to close to slow the first round of Covid-19 infections.
In Texas and New York, as well as many other states, there was a significant drop in filings. Because of fraud, claims have remained high, especially in California and Ohio. The expansion of unemployment compensation packages, which now have a weekly $300 subsidy, could be inspiring more individuals to apply for help, but not all applications are accepted. According to the most recent labour department report on first compensation, only a small percentage of claimants were accurate in recent months.
According to the US Centers for Disease Control and Prevention, most American adults are now eligible for Covid-19 vaccines, and more than half of the group has had at least one injection of the vaccine. A majority of the US adults, as well as 26% of the population total, are completely vaccinated. This, along with the White House’s $1.9 trillion pandemic aid programme, has enabled a larger economic reengagement. Businesses are struggling to find jobs as a result of the increase in demand. In March, retail prices set a new peak, and factories are humming.
The government surveyed business establishments for the nonfarm payrolls portion of April’s jobs report during the time covered by last week’s claims results. The number of first-time filings has decreased from 765,000 in mid-March, raising expectations for solid job growth in April.
