US Jobless Claims Fall to Lowest Level Since 1969
New applications for unemployment benefits in the USA fell last week to the lowest level ever since 1969 as employers hold on to their workers in the midst of labour shortage.
According to the Labour Department, the first unemployment claims to replace layoffs fell by 28,000 last week to seasonally adjusted 187,000. This was slightly lower than last December and was the lowest level of first billing for more than 52 years since September 1969. The 4-week moving average, which smoothes the fluctuations in the numbers, decreased from 11,500 to 211,750.
A measure of the total number of people on the unemployment rolls through regular state programs moved down to 1.35 million for the week, reporting the lowest level since January 1970, a time when the labour force was roughly half as large as it is today.
According to the Labor Department, despite the rapid economic recovery, the number of employees in February was about 500,000 less if compared to before the pandemic. As a result, employers are having a hard time filling vacancies.
The fall in new unemployment claims come at a time when the new coronavirus cases are dropping continuously. It could result in more people getting back into the workforce. Around 2.8 million people were not working in early March due to covid-19.
Joshua Shapiro, chief U.S. economist at MFR, Inc has said that Fed officials are beginning to realise the hole they have dug for themselves and what a difficult tightrope walk it's going to be to try to squeeze inflation without causing something to crack.