New claims for unemployment benefits fell to 1.314 million for the week ended July 6, 99 thousand fewer than a week earlier, the Department of Labor reported Thursday.
Economists surveyed by Econoday had been expecting 1.375 million claims.
This was the 15th consecutive week with initial claims above one million. Expectations for claims to fall have come down. A week ago, economists forecast that claims would fall to 1.38 million but they were reported at 1.427 million. Those claims were revised down by 14,000.
The estimate for ongoing unemployment claims, those made after the initial filing, during the week ending June 27 was 18,062,000, a decrease of 698,000 from the previous week’s revised level. The previous week’s level was revised down by 530,000 from 19,290,000 to 18,760,000. The 4-week moving average was 19,085,500, a decrease of 636,000 from the previous week’s revised average. The previous week’s average was revised down by 132,500 from 19,854,000 to 19,721,500.
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.
The highest insured unemployment rates in the week ending June 6 were in Puerto Rico, Nevada, Hawaii, the Virgin Islands, New York, California, Louisiana, Massachusetts, Georgia, and Connecticut.
The largest increases in initial claims for the week ending June 27 were in Michigan (+18,668), Indiana (+15,496), Texas (+7,046), Virginia (+6,662), and Kentucky (+5,794), while the largest decreases were in Oklahoma (-40,208), Florida (-11,313), Maryland (-9,926), Georgia (-8,240), and California (-7,132).