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This story originally appeared on The Epoch Times
The number of American workers filing for unemployment edged up last week following four consecutive weeks of declines, as the labor market continues along its bumpy road to recovery.
First-time filings for unemployment insurance, a proxy for layoffs, came in at 353,000 for the week ending Aug. 21, a rise of 4,000 from the previous week’s revised level of 348,000, the Labor Department said in a statement (pdf).
“Alas, a fifth straight weekly decline was not to be with seasonally adjusted new jobless claims,” Bankrate senior economic analyst Mark Hamrick told The Epoch Times in an emailed statement. The pandemic demonstrated that not all things are linear and that the most recent snapshot of jobless claims supports that.
Weekly claims surged to a record high of 6.2 million in April 2020 when the COVID-19 outbreak triggered lockdowns that shook the economy. They have fallen steady since then and remain relatively stable at the 300,000.–a historic high. Weekly unemployment filings were around 220,000 before the pandemic.
Hamrick stated that COVID had a significant impact on the economy since early last year. The final chapter of this complicated story is yet to be completed. The nation’s unemployment rates have fallen significantly since last year’s peak, and could be on the verge of moving lower in the August snapshot.
The national unemployment rate fell by 0.5 percentage points over the month in July, dropping to 5.4 percent, according to the Labor Department. This is 4.8 percentage point lower than July 2020, and much lower than the April pandemic peak at 14.8 percent.
However, despite last month’s encouraging unemployment rate, Labor Department’s report on jobless claims showed that over 12,000,000 Americans received some type of unemployment aid in the week ended Aug. 7. This is an increase of 180,000.
While the labor market recovery may not be complete, workers are being buoyed in part by record-breaking job opportunities. This has boosted their bargaining power, and forced businesses to increase wages. In June, the so-called quits ratio, or the percentage of workers who leave their job without being asked, was just 2.7. This is slightly less than the April record of 2.8.
According to Hamrick, “Most people in the workforce polled by Bankrate expect to search for new jobs over the next 12 months.” These individuals value flexibility and work more than higher wages.
Businesses have been forced to increase wages because of the difficulties in hiring and keeping staff.
The National Federation of Independent Business July jobs report found that 49 percent of small business owners reported job openings that couldn’t be filled–a 48-year record high.
“Small business owners struggled to find qualified workers for their open positions, which has impaired business activity in the busy summer months,” NFIB chief economist Bill Dunkelberg said in a statement. To attract employees, owners are increasing their compensation levels to the highest level in 48 years.
Fears of the virus and a lack of child care have all been blamed as well for the shortage of workers, partly responsible for the 5.7 million jobs that remain below the peak in February 2020.
Minimum 25 Republican-led states have pulled out federally-funded unemployment programs. This includes the $300 weekly top up, claimed GOP leaders and businesses. These funds were intended to encourage jobless Americans not to return home.
There is no evidence to show that early terminations of federal benefits have led to an increase of hiring in these states. Experts however say more data on the labor market will be required to verify the impact of the policy.
Tom Ozimek is a journalist, marketer, communications and marketing expert with a background in adult education, journalism and deposit insurance. Roy Peter Clark has the most valuable writing advice. He says, “Hit your target” and “leave it for last.”
Publiated at Thu 26 August 2021, 17:18:05 +0000