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Jobless claims rise to 742,000 in sign of stalling recovery

Jobless claims rise to 742,000 in sign of stalling recovery
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Initial jobless claims rose to a seasonally adjusted total of 742,000, a jump of 31,000, in the second week of November, according to the Labor Department, a sign of a stalling recovery amid the most recent COVID-19 outbreak.

Unadjusted claims were up 2.5 percent to 743,460, and nearly 24,000 more Americans were added to the emergency Pandemic Unemployment Assistance program, which allows self-employed and gig economy workers to receive unemployment benefits.

The latest weekly data comes as cities and states begin to impose renewed restrictions to contain the unbridled spread of COVID-19. New cases have averaged more than 160,000 a day in the past 7 days, a 77 percent increase from two weeks before.

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“Given the trajectory of the pandemic, we may be stuck in the 1 million a week range of Americans claiming benefits (both state and federal) for some time, and we'll be lucky if that level doesn't rise by 100,000 to 200,000 additional claims per week,” Robert Frick, corporate economist at Navy Federal Credit Union, said in response to the new data.

The Labor Department report on jobless claims, which remain higher than the pre-pandemic record from 1982, showed that by the last week of October, the total number of people claiming benefits across all unemployment programs stood at 20.3 million, a marked decline of 841,000. That trend may have changed in the weeks that followed, however.

“While long-term claims fell, that's likely a combination of people getting jobs and those dropping out of the workforce,” Frick said.

The data may reflect, to some degree, some long-term unemployed people running out available programs.

A study from the progressive Century Foundation found that by the end of December, nearly 4.5 million people will have already run through two emergency relief programs Congress set up in March.

At that point, two key relief programs set to expire at the end of December would leave another 12 million people without federally funded unemployment benefits, though 2.9 million could sign up for state-level extended benefits programs.

For months, Congress has stalled on a fifth COVID-19 relief bill, which would extend those programs, restore some level of additional weekly benefit and provide stimulus to boost the economy.

— Updated at 9:09 a.m.