Just under 1.2 million people filed for unemployment benefits for the first time last week, a decline from the past two weeks but still the 20th straight week of claims above 1 million. The weekly total of 1.186 million is lower than economist predictions of 1.4 million claims.
The weekly data, released Thursday by the Department of Labor, comes ahead of Friday's highly anticipated monthly jobs report, which offers a more comprehensive — though backward-looking — assessment of the labor market. While the unemployment rate is expected to have fallen to around 10.6 percent, recent layoffs by businesses affected by the spike in coronavirus rates in some parts of the country are unlikely to have been captured in the monthly snapshot.
Just this week, Booking Holdings, which operates travel sites such as Kayak and booking.com, said it would be slashing its workforce by 25 percent, laying off 4,000 people. Nike announced it would be cutting 500 workers from its Oregon headquarters. NBCUniversal, the parent company of NBC News, also laid off around 10 percent of its 35,000-strong workforce.
Global outplacement firm Challenger, Gray & Christmas said U.S. employers announced a total of 262,649 job cuts in July, the third-largest monthly total since the coronavirus pandemic began, according to Reuters. Layoffs for the year to date are currently just 109,180 away from the record 1.957 million job cuts announced in 2001.
“It is clear that many job losses are now permanent, and it will be challenging for many workers to find new jobs and feel safe taking jobs that are public-facing,” said Andrew Challenger, senior vice president at Challenger, Gray.
Thursday's data comes as lawmakers continue to debate legislation on the next round of coronavirus relief. Until a compromise is reached, millions of Americans have no additional financial assistance for the jobs they lost after the government shut down the economy to help stop the spread of the virus.
While no deal has been reached, discussions were weighing $400 a week in federal unemployment payments through December, a reduction from an earlier round of $600 payments, according to sources who spoke to NBC News. It would also extend the eviction moratorium through the end of the year.
After two straight weeks of stock market gains and better-than-expected corporate earnings, Wall Street is now firmly focused on any signs that lawmakers can agree on the next fiscal stimulus package.
“The clock is ticking for U.S. policymakers to get something done,” Hugh Gimber, global markets strategist at J.P. Morgan Asset Management, told Reuters.
The recent market surge has largely been propelled by rising shares at a handful of gigantic companies, from Apple to Walmart — all companies whose products and services have been highly in demand as Americans stocked up on essentials, battened down the hatches and stayed home.