New claims for unemployment benefits fell to 1.508 million last week, data from the Department of Labor showed Thursday.
This is the thirteenth consecutive week of initial claims above 1 million. Prior to March, initial claims had never risen as high as 700,000.
Economists had forecast 1.2 million claims. Last week’s claims were initially reported at 1.54 million and were revised up to 1.566 million.
Claims hit a record 6.87 million for the week of March 27. Each subsequent week has seen claims decline.
Continuing claims for unemployment benefits during the week ending May 30 fell by 62,000 to 20,544,000. The previous week’s level was revised down by 323,000 to 20,606,000. These are reported with a one-week lag.
The federal government has been chipping in an extra $600 a week to state unemployment benefits, making the program much more generous. Many workers can now earn more on unemployment than they did when they had a job. An analysis done by Isabel Soto of the American Action Forum found that the maximum unemployment benefit amount is greater than median wage in all states except the District of Columbia. That may be discouraging some workers from seeking work and leaving the unemployment rolls.
“Using 2019 wage and unemployment data, an upper–bound estimate of 92.8 million workers (or 63 percent of the workforce) typically make below the maximum weekly unemployment benefits under the CARES Act,” Soto wrote.
These super-sized benefits, however, are set to run out in July.
In addition to claims for regular unemployment benefits, the government now offers two new forms of unemployment benefits to business owners, self-employed, gig-workers, and independent contractors who would not ordinarily qualify for unemployment benefits.