Unemployment claims drop to 847,000

Unemployment claims drop to 847,000
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Weekly unemployment claims dropped to a seasonally adjusted total of 847,000 in the week ending Jan. 23, a decrease of 67,000 from the previous week, but still a historically high figure amid the ongoing COVID-19 pandemic.

The claims came in below economists' expectations of 875,000, according to CNBC. Claims from the previous week were revised up by 14,000 to 914,000.

Despite the improvement, the continuing high level of unemployment claims shows the ongoing weakness of the economy and the potential softness of the recovery, problems that have been exacerbated by the mid-winter spike in COVID-19 cases across the nation.

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Unadjusted figures saw a larger, 10.4 percent drop in claims, while 426,856 people signed onto Pandemic Unemployment Assistance (PUA), an emergency program that provides benefits to gig workers and the self-employed.

The total number of claims, a data point that lags two weeks behind, popped an astonishing 2.3 million, or 14.3 percent, to 18.2 million in the week ending Jan. 9.

Some analysts noted that the figures were expected to increase after several programs were renewed in late December, allowing people who had used up their benefits to reapply.

Andrew Stettner, senior fellow at The Century Foundation, said that the figures showed the danger in waiting to renew benefits.

“The report finds states still struggling to get benefits going after they lapsed in late December," he said.

Both PUA and another emergency program offering additional weeks of benefits remained below their December levels.

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"These claims were down despite the fact that hundreds of thousands of workers who exhausted their extensions of benefits before the end of the year can now reapply for the program," he said.

Stettner said the slow uptake should serve as a warning to Congress to extend the emergency programs well ahead of their March 14 expiration, otherwise people could lose their benefits as rickety state unemployment systems struggle to update their software.

President Biden included unemployment extensions through the end of September in his $1.9 trillion COVID-19 relief package, which is facing skepticism from Republicans in Congress who say it is too large and poorly targeted.

Democrats have threatened to pass the package using budget reconciliation, a procedure that can sidestep the filibuster and allows for simple majority approval.

--Updated at 9:38 a.m.