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US layoffs remain elevated as job market’s gains weaken


Bangladeshpost
Published : 10 Sep 2020 09:42 PM

The number of Americans applying for unemployment benefits was unchanged last week at 884,000, a sign that layoffs remain stuck at a historically high level six months after the viral pandemic flattened the economy, reports AP.

The latest figures released by the Labor Department Thursday coincide with other recent evidence that the job market’s improvement may be weakening after solid gains through spring and most of summer. The number of people seeking jobless aid each week still far exceeds the number who did so in any week on record before this year.

Hiring has slowed since June, and a rising number of laid-off workers now say they regard their job loss as permanent. The number of people who are continuing to receive state unemployment benefits rose last week, after five weeks of declines, to 13.4 million, evidence that employers aren’t hiring enough to offset layoffs. Job postings have leveled off in the past month, according to the employment website Indeed.

“The claims data were disappointing,” said Rubeela Farooqi, chief U.S. economist at High Frequency Economics. “It is especially concerning that the pace of layoffs has not slowed more 

materially even though the economy has reopened more fully and 

more and more businesses have come back online.”

The weakening signs are emerging just as Congress remains unable to agree on further economic relief despite widespread urging from economists and warnings from officials at the Federal Reserve that more stimulus is needed.

House Democrats have approved legislation that would extend a now-expired $600-a-week federal jobless benefit, renew a small business lending program and provide more funding for state and local governments to make up for lost tax revenue.

Senate Republicans oppose those measures. They are backing a much smaller bill that would provide a scaled-back new benefit for the unemployed and money for schools. That legislation is likely to fail in a vote Thursday. Congress may adjourn later this month for the fall election campaigns without approving any additional aid.

Hiring will likely remain restrained as long as Americans are unable or reluctant to resume their normal habits of shopping, traveling, dining out and engaging in other commerce. The rate of reported infections has dropped over the past several weeks but remains well above where it was during the spring. Most analysts say the economy won’t likely be able to sustain a recovery until a vaccine is widely available.