The number of Americans filing for unemployment benefits last week for the first time continued at historically high levels, reaching 751,000, slightly better than analyst predictions.
While the number of new jobless claims has fallen from its peak in the spring, weekly totals have remained at historically high levels as small businesses and large corporations shed staff in an attempt to right-size amid the coronavirus pandemic.
Thursday's data from the Department of Labor represents the last economic snapshot before the presidential election. Around 22 million jobs were lost as the once-in-a-century pandemic ravaged the country, and both President Donald Trump and former Vice President Joe Biden have made economic recovery a major component of their platform.
While some jobs were recovered over the summer months as stores and restaurants were able to operate outdoors, at least 11 million Americans remain out of work — and additional financial support remains out of reach with now, after negotiations between House Speaker Nancy Pelosi, D-Calif., and Treasury Secretary Steven Mnuchin hit a wall this week.
“That initial bounce we got in employment that was the easy part,” Ryan Sweet, senior director of economic research at Moody’s, told NBC News. “The hard part is associated with the improvement in the economy, and now that we have no fiscal stimulus coming until after inauguration, you could start to see [jobless] claims creep back up, especially if we see layoffs in leisure and hospitality and airlines.”
With the country entering a third wave of new cases, economists anticipate a new round of potential layoffs. Boeing, the country's largest exporter, said Wednesday it will cut roughly 11,000 additional jobs through the end of next year, for a total of 30,000 layoffs since the beginning of the year. Casinos, resorts, airlines and the hospitality industry have all warned of impending layoffs if they do not receive any fiscal aid.
Of particular concern to economists is the length of unemployment for the average American, since it is an indicator of how quickly the economy is ramping up again. Thursday's data indicated that 7.7 million people are still drawing ongoing weekly benefits. About 60 percent of unemployed people have been without work for at least 15 weeks, according to Liz Ann Sonders, senior vice president and chief investment strategist at Charles Schwab.
“The longer you’re unemployed, the less likely you’re going to find a job — and the longer you’re unemployed, you might just drop out of the job market altogether,” Sonders said. “I think those data are important in this unique pandemic.”
Federal Reserve Chairman Jerome Powell has repeatedly warned that a “significant group” of people may “still be struggling to find jobs” even as the labor market opens back up, threatening "longer-run damage to the productive capacity of the economy."
But with either a Biden or Trump victory on Tuesday, the economy is still struggling — and will only fully recover job losses from the pandemic in 2024, according to Moody’s forecasts.
“The labor market we won't be recovered for years,” Sweet said. “We still have a significant hole to dig ourselves out of.”
Businesses will struggle to stay open if customers are concerned about catching the virus, said AnnElizabeth Konkel, economist at Indeed hiring services company.
"Whether or not new case clusters result in lockdowns, the coronavirus still hurts both employers and jobseekers," Konkel said. "A surge in the virus also dampens job seeker interest in opportunities that aren’t remote. Getting the virus under control is the only path to a full economic recovery."