Dip in weekly unemployment benefits claims in the US

There has been a reduction in the number of people applying for unemployment benefits in the US last week.

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However, the scenario does not look very bright if the period post outbreak of the coronavirus is considered. The Labour Department reveals that 8,47,000 new claims were made for jobless benefits in the week ended January 23. This was much lower than the 9,14,000 claims that were made in the week before that, taking into account seasonal adjustments.

Under an initiative launched during the pandemic— for the benefit of those workers who are not covered under any scheme— another 4,26,856 claims, were made without seasonal adjustment.

There appears to have been a spike in the number of people enjoying benefits for the long-term unemployed.

While there have been fluctuations in terms of new benefit claims in recent weeks, it remains to be seen if this report will mark a sustained decline, but 10 months into the pandemic, new applications each week have yet to drop below the worst single week seen in the 2008-2010 global financial crisis.

With the ongoing pandemic and the risk of the new strain of virus and related restrictions in activities, claims are not expected to reduce any time soon.

The pandemic has adversely impacted the American job market, with nearly 18.3 million people getting some form of financial assistance as on the week ended January 9.

In the same week, over 1.5 million people claimed financial assistance under ‘extended benefits’, which is the last scheme that can benefit people who have been jobless for a long time. Considering that this benefit is not available in all the states, things certainly do not look too bright.

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