Around 745,000 people filed for unemployment benefits for the first time last week, underscoring how the labor market continues to be hammered by the pandemic and by restrictive measures to control spread of the coronavirus.
Economists had predicted the latest weekly initial jobless claims for the week ended Feb. 26 would total around 750,000. It's the 50th week in a row that total initial claims have been higher than the worst week of the Great Recession.
As they work on rebuilding the economy, Treasury Secretary Janet Yellen and Federal Reserve Chairman Jerome Powell have both stressed that "nothing is more important" than widespread vaccination. With 1 in 10 Americans now fully vaccinated, there are already signs that vaccination is having its intended effect, according to economists' surveys.
“The disproportionately large declines in cases and Covid-19 fatalities among residents of long-term care facilities, where 4.6 million residents and staff members have already been vaccinated, suggests that vaccinations are having significant real world benefits,” said Daan Struyven, senior economist at Goldman Sachs, in a report this week.
President Joe Biden said Tuesday the United States will have enough vaccines for every adult by the end of May, two months earlier than the administration had previously estimated, partly due to an agreement between Johnson & Johnson and Merck, who will assist with production.
For now, the pain of joblessness drags on. One year after the pandemic began, some 10 million Americans remain without work and a further 7 million have abandoned their search for work.
"This suggests it will take some time to re-employ all of these millions of Americans either unemployed or underemployed or have exited the workforce," said Mark Hamrick, senior economic analyst at Bankrate.
"Springtime for the economy appears to beckon in the months to follow, as more vaccinations are given, and many activities previously taken for granted eventually resume," Hamrick said. "It is with that backdrop that consumers will feel freer to spend, including after possible passage of further federal stimulus legislation and $1,400 payments for many households."
The closely watched monthly employment report from the Bureau of Labor Statistics is released on Friday, and is expected to show 210,000 jobs were added to the economy last month. January gained just 49,000 positions, in part because holiday gatherings led to an increase in coronavirus infections and more business restrictions.
On Wednesday, monthly jobs data from private payroll firm ADP showed the number of hirings rose less than expected, with just 117,000 jobs versus estimates of 205,000.