Weekly Unemployment Benefit Claims Down to 860,000

Unemployment benefits last week. The figure dropped to 860,000 from 884,000 the previous week, the Labor Department reported. The number ...

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  • Unemployment benefits last week. The figure dropped to 860,000 from 884,000 the previous week, the Labor Department reported.
  • The number of unemployment who availed themselves of this benefit stood at 12,628,000 until the week that ended on September 5
  • The good news comes after the Federal Reserve announced that it will keep interest rates close to 0% until 2023

Unemployment benefits last week. The weekly number of applications for unemployment benefits in the United States fell to 860,000, compared with 884,000 in the previous week, reported Thursday the Department of Labor.

The number of unemployment who availed themselves of this benefit stood at 12,628,000 until the week ending September 5.

unemployment benefits last week

Twitter US Labor Department

So it was for the unemployment figure the week before.

The weekly number of applications for unemployment benefits in the United States rose slightly to 884,000, compared with 881,000 in the previous week, according to the Department of Labor.

The four-week filing average, a measure that compensates for weekly ups and downs, dropped to 970,750 compared to 971,750 in the prior period.

In the week ending August 29, according to the government report, there were 13.38 million people receiving this benefit, compared with 13.25 million in the previous week.

The number of requests for the benefit has fallen gradually since, reflecting the impact of the COVID-19 pandemic on the labor market, it reached 6.8 million in the last week of March.

This indicator does not include between 16 and 18 million freelancers and subcontractors who received a subsidy of $ 600 per week within a temporary program approved by Congress and enacted by President Donald Trump in March.

The economic reactivation in the United States suppressed 1.8 percentage points of the unemployment rate in August, lowering it to 8.4% of the workforce, in a month in which private companies and the government added 1.76 million jobs, according to the Bureau of Labor Statistics ( BEA, in English)

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These improvements in the labor market reflect the continued resumption of economic activity that had been restricted due to the COVID-19 pandemic and efforts to contain it, according to the government.

The private sector added 1.46 million jobs last month and another 301,000 were opened in the government, added the report, which noted that the growth in government employment reflects the temporary hiring of personnel to prepare the 2020 Census.

According to the BEA bulletin, in August and among a civilian workforce of 160.3 million people there were 13.5 million unemployed, and the country now has about 11.5 million fewer jobs than in February.

The Fed intends to keep interest rates close to 0% until 2023

The Federal Reserve (Fed) announced this Wednesday that it plans to keep interest rates close to 0% until 2023, the year in which it expects its inflation target of 2% to be met.

“The recovery has progressed faster than we expected, but overall economic activity is still well below its levels at the beginning of the year,” Fed Chairman Jerome Powell said at the post-conference press conference. two-day meeting of the Federal Open Market Committee (FOMC).

In its report, the FOMC stressed that “weaker demand and significantly lower oil prices are holding back consumer price inflation.

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Thus, the US central bank kept its promise to leave interest rates close to zero, in the range between 0% and 0.25%, and promised to keep the price of money at that level until inflation rises by steadily.

According to Powell, the 2% inflation target will not be reached until 2023.

However, the Fed chief explained at the press conference that the central bank will not ignore concerns about financial stability or other risks that could impede the achievement of its monetary policy objectives.

Fed governors also changed their economic forecasts to reflect a smaller drop in gross domestic product (GDP) and a lower unemployment rate in 2020.

In June, the Fed anticipated a contraction of 6.5% of real GDP and an unemployment rate of 9.3% by the end of 2020, but the August employment report, which shows an unemployment rate of 8.4%, better than expected, suggests that economic recovery may be faster than originally expected.

Thus, updated forecasts indicate that the Fed now anticipates a 3.7% contraction in GDP and that the unemployment rate will reach 7.6% by the end of the year.

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Despite these improved prospects, Powell said they will not lose sight of the 11 million people who have been left without jobs during the coronavirus pandemic.

Even so, the Fed said in its statement Wednesday that the pandemic “will continue to weigh heavily on economic activity.”

“The path of the economy will depend significantly on the course of the virus. The current public health crisis will continue to affect economic activity, employment and inflation in the short term, and poses considerable risks to the medium-term economic outlook ”, emphasized the governors of the different districts of the Fed.

In recent months, the Federal Reserve has launched a series of monetary policy tools aimed at keeping markets running and the economy afloat, including loan and liquidity programs and interest rates close to 0%.

Among other measures, the Fed can buy more bonds, offer more detailed promises to keep credit easy for years to come, or even take more aggressive action if the pandemic worsens and conditions deteriorate.

The Federal Reserve, which has a dual mandate of price stability and employment promotion, has traditionally used the movement of interest rates to contain inflationary pressures, trying to balance it at the same time with a strong labor market.

With information from the Efe agency.

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