US jobless claims rise unexpectedly to 419,000, the most since March | Business and economic news

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In the week ended July 17, initial unemployment claims in mainstream state programs totaled 419,000, up 51,000 from the previous week, data from the U.S. Department of Labor shows.

Through Bloomberg

US state unemployment insurance claims unexpectedly rose the most since late March last week, highlighting week-to-week volatility in an otherwise improving job market.

In the week ended July 17, initial unemployment claims in mainstream state programs were 419,000, up 51,000 from the previous week, Labor Department data showed Thursday. The median estimate in a Bloomberg survey of economists called for 350,000 new applications.

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Ongoing state benefit claims fell to 3.24 million in the week ended July 10.

Stock futures wiped out gains and Treasuries advanced according to the data.

The unexpected jump in first-time jobless claims reflected exorbitant increases in four states — Michigan, Texas, Kentucky and Missouri. While a number of factors complicate the seasonal adjustment of the weekly data, the rapidly spreading delta variant of COVID-19 could cause further volatility in the numbers in the coming months.

Ian Shepherdson, chief economist at Pantheon Macroeconomics, wrote in a note, “Claim numbers continue to suffer from seasonal adjustment issues caused by shifts in the timing and magnitude of automakers’ annual remodeling shutdowns from year to year.

The first damage figures coincide with the survey period for the Department of Labor’s monthly jobs report. A majority of states reported declines on an unadjusted basis from the previous week, including New York, Oklahoma and Tennessee.

Nearly half of U.S. governors have terminated all three federal unemployment benefit programs set up during the pandemic before they expire in September, arguing that the additional aid is slowing job growth and preventing companies from filling record job openings.

Continuing claims across all programs were down 1.26 million in the week ended July 3, primarily due to the end of Pandemic Unemployment Assistance and Pandemic Emergency Unemployment Compensation in certain states.

Lawsuits in some of those states challenging the legal authority of governors to discontinue aid could restore or maintain the discontinued benefits until they officially expire in September.

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