Jobless claims fall to 166K, lowest level since 1968

New weekly claims for unemployment insurance fell to the lowest level since 1968 at the end of March, according to data released Thursday by the Labor Department.

In the week ending April 2, the seasonally adjusted total of new claims for jobless benefits fell to 166,000, a decline of 5,000 from the previous week. Seasonally adjusted weekly jobless claims have fallen to the lowest level since the week ending Nov. 30, 1968, when 162,000 Americans filed to start a new cycle of unemployment insurance. 

The Labor Department also revised the previous week’s seasonally adjusted total of jobless claims down by 31,000 to 171,000 from an initially reported level of 202,000. The size of the revision may be due in part to new seasonal adjustments used by the Labor Department this week to better account for the effects of the pandemic.

Without seasonal adjustments, weekly jobless claims fell 3,674 to a total of 193,137, a decline of 1.9 percent from the previous week.

After briefly rising in mid-January during the peak of the omicron wave, jobless claims have fallen steadily through 2022 as businesses seek to hire and retain as many workers as possible amid historic demand for labor. 

Companies have avoided laying off workers, even those initially hired for seasonal roles, as job openings outnumber jobseekers nearly 2 to 1. While firms are still hiring from a smaller pool of workers than before the pandemic, the U.S. added almost 1.8 million jobs in the first three months of March and pushed the unemployment rate to 3.6 percent, 0.1 percentage points higher than in February 2020.

President Biden and Democrats had counted on the rapid recovery from the pandemic-driven recession to help defend their congressional majorities in the upcoming midterm elections. But the steep rise in inflation that came along with the swift rebound has wiped out much of the political benefit of the stellar job market for workers.

Voters’ views on Biden’s handling of the economy have fallen steadily even amid the job growth and steadily rising consumer spending. Prices rose 7.9 percent annually in February, per the Labor Department’s consumer price index, and economists expect inflation to have risen again in March.

Republicans have pinned the steep rise in inflation on Biden’s $1.9 trillion stimulus bill, while the White House and Democrats blame it on pandemic-related supply chain disruptions and the Russian invasion of Ukraine. Most economists say the persistence of high inflation is caused by a combination of those factors, including how much faster consumer demand recovered than businesses still hindered by the pandemic.

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