Jobless claims in the US ranged in the millions again last week, but continue to tick downward from the peak seen in mid-March. 1.542 million Americans filed for unemployment claims in the week ended June 6, slightly below expectations of 1.55 million.
Claims for the week before were revised higher from 1.88 million to 1.897 million. 44 million Americans have filed unemployment benefits claims in the last three months according to the Labor Department.
- Claims for the week ended June 6 came in at 1.542 million vs. 1.55 million expected and 1.88 million the week before.
- Continuing claims came in at 20.93 million for the week ended May 30 vs. 20 million expected and 21.27 million the week before.
- Claims are still rising in some areas but steadily decreasing on a national basis.
The jobless claims data follow a surprising report from the Bureau of Labor Statistics revealing 2.5 million additional jobs added to nonfarm payrolls in May, in sharp contrast to the expected losses of 7.5 million. The rate of unemployment fell from 14.7% to 13.3% instead of rising as expected. Continuing claims are also ticking downwards, although not as quickly as expected. Claims continued after an initial week of aid came in at 20.93 million vs. 20 million expected.
Allow me to frame this appropriately:
New jobless claims more than double the worst week in history before 2020. https://t.co/6DGKlN0qwI
— The Hoarse Whisperer (@HoarseWisperer) June 11, 2020
Claims rose in California from 229,000 to 258,000 in the week ended June 6. In Georgia, claims fell from 149,000 to 136,000. Claims in Florida came in at 111,000 and New York reported 94,000 new claims. Claims for Pandemic Unemployment Assistance (PUA), a program covering benefits for those originally ineligible for unemployment insurance, fell from 796,813 to 705,676 in the week ended June 6.
As the US economy begins to reopen, the labor market is starting to recover slightly. However, the timeline for the expected recovery is still quite uncertain. Where the US had a booming labor market just 3 months ago with unemployment near a 50 year low, the labor market will take years to get back into a healthy position, with no indication as to how or when things will return to late 2019 conditions.
Nomura economist Lewis Alexander stated that the labor market hit a low in mid-May, and that rehiring was now accelerating with more businesses reopening throughout the economy during that time.
“That said, the persistent elevated readings of initial jobless claims highlight significant ongoing strain and we expect the unemployment rate to remain in double digits into 2021,” he added “A persistent decline in the PUA claims as we’ve seen in the regular claims data would further increase our conviction in the labor market stabilization and suggest processing backlogs have been cleared. Similarly, stabilization in PUA continuing claims would signal re-employment for gig workers, but this is not our base case in next week's report.”
Gold pared losses in today’s market, despite the somewhat promising labor news. Spot gold last traded at $1,736.07/oz, down -0.07% with a high of $1,739.42/oz and a low of $1,712.94/oz. Gold prices came under pressure from rising producer price inflation, which is a leading indicator of inflation in consumer prices.