Unemployment claims fell sharply last week despite severe winter storms that swept across Texas and other parts of the South, the Labor Department reported Thursday.
The first time unemployment insurance was filed was 730,000 for the week ended February 20, well below the Dow Jones estimate of 845,000.
The total was a significant decrease compared to the 841,000 the previous week, a number revised down by 20,000 lower.
Despite the decline, the total, the lowest since November 28, was still far above anything the U.S. labor market had seen before the Covid-19 pandemic.
Continued demands also fell, declining by 101,000 to 4.42 million, the lowest since March 21, 2020, but also well above anything the labor market had seen before the pandemic.
The decline probably did not take into account those who were expected to serve due to the storms.
“The sharp drop in jobless claims is likely due to people in states hit hardest by last week’s violent storm, particularly Texas, which has better things to do than jobless claims,” said Pantheon chief economist Ian Shepherdson. Macroeconomics, written. “We expect a rebound next week. The trend appears to be flat, but we remain confident that claims will begin to decline soon, at first slowly but then faster as the economy reopens in April and May.”
Other economic reports on Thursday morning showed that spending on long-term goods jumped 3.4% and 1.4% excluding transport, both well above Wall Street’s estimates.
The second reading of gross domestic product in the fourth quarter of 2020 also showed an increase of 4.1%, a tenth percentage point from the first reading, but slightly lower than the estimate of 4.2% of Dow Jones.
The decline in the number of unemployed claims masked the continuing pressure in the labor market.
Although the overall number has dropped, the number of people filing through pandemic-related programs has continued to rise, with just over 1 million more claims on the Pandemic Emergency Program, compensating those whose usual benefits run out.
In all, there were just over 19 million Americans who received compensation on February 6, an increase of more than 700,000 over the previous week.
However, more recent data shows that demands are rising in the Pandemic Unemployment Assistance Program, which offers benefits to those who are not normally eligible. During the weeks of February 13 and February 20, more than 964,000 Americans submitted under the program.
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