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U.S, Labor Market Slows Further as Initial Jobless Claims Hit 885,000

Published 12/17/2020, 08:32 AM
Updated 12/17/2020, 08:36 AM
© Reuters

© Reuters

By Geoffrey Smith 

Investing.com -- The number of people filing initial claims for jobless benefits rose again to a new three-month high last week, indicating that the pace of layoffs due to the latest wave of the coronavirus pandemic is accelerating.

The Labor Department said 885,000 initial claims were filed last week, and revised the previous week’s number up by 12,000 to 865,000. Economists had counted on a decline to 800,000.

That’s the highest level since early September. The news comes a day after figures showing that retail sales fell 1.1% in November, their first monthly decline in six months.  Together, the figures show a clear loss of momentum in the economy under pressure from a pandemic that has gained in strength with the onset of winter and with the increased transmission opportunities created by the election campaign and the holiday shopping season.

The number of people filing continuing jobless claims fell however, to 5.508 million from an upwardly revised 5.781 million. That was bigger than the expected drop, but economists warned against seeing it as a sign of improvement. 

"The drop in continuing claims is not a sign of improving labor market conditions," said Diane Swonk, chief economist with Grant Thornton, via Twitter. "Long-term unemployed are running out of benefits and shifting into special pandemic insurance, which is slated to expire unless Congress acts before year end."

There was further evidence of the slowdown as the Philadelphia Federal Reserve's monthly business survey showed a sharp drop in its main manufacturing index to 11.1 from 26.3, with declines in all of its sub-indices: prices paid, employment and new orders

However, there was slightly better news from the housing market, which has been a source relative of strength all through the pandemic. The number of housing starts rose 1.2% on the month to 1.547 million, their highest since March. Building permits, meanwhile, rose 6.2% on the month to their highest in over 12 years.

Latest comments

And the markets could care less. Like the China Trade deal pumped up the markets every time someone said a deal was in the works and then never happened. Investors continue to be delusion without rhyme or reason.
Look at the massive number of losers we have in US.
that would be the 6.7% who don't want to work. Millions of jobs available
Its a fed fuelled party S&P not even reacting to jobless claims or the state of the Economy. Its all rigged so the rich get richer and the poor get poorer.  what a scam
I heard that same dusty speech at Purdue when R3agan was president..
Relax it will correct big time then its time for you to make money
printing doesn't solve problems.
fed goes: well then we just gotta print more.
The fed buys big company bonds infusing cash, the companies buy their own shares back and give them to the co. Execs in huge bonuses. Think who's winning here! The average worker or unemployed carry very little stock. The biggest wealth transfer in history.
That’s Donny for ya!! Soon to change!
someday the 2020 market explosion and coming crash will live on in history books for eternity
students will read and wonder how we didn't see it
I want my shirt: “I knew 2020/2021 crash before you”
high prices = cause of cheap dollar not high value.
Too late for stimulus...A resuscitated patient who achieves a stable condition on full life support can’t really be called recovered.
Americans need to wake up already and see your government doesn't care about you, they never have, stop depending on corrupt politicians who only align their self interests. they continue to collect their huge federal pay checks while the country suffers and waits for a stimulus that may never show up or that will take months to arrive.
When is it supposed to have the final decision of simulus in/out??
where is the ****stimulus?
More free money ~ stimulus, heard this word over months this year. US stock market is hoax.
stimulus money isnt free, your lovely government will make America pay it back in future taxation. no such thing as free money
stocks have been dropping since news of vaccine approval....wth...does not make sense huge sales of stocks..I think its investment companies getting out creating an artificial market.
ita all a hoax...it will be gone in april...its only the flu....I like to downplay things...I have the best brain and only use the best words...
lol..
HI ! I am here
The criminal, financial dismantling of America continues.  The US stock market is the laughingstock of the financial world.
good news- finally :D to the moon now
I hope you will land like the Elon's missiles
Yet assets will continue to new high after new high because our federal reserve will always keep handing out free money to the ones that don’t need it.
facts
Good news for the bullish!
And congress is still arguing to help the people. If the congressmen/woman's stockportfolio would go down, stimulus would be there within 24 hours! Sad but true.
Well said, Sir
Bullish! DOW 40k! We dont need no people working. Just keep printing money...
So another + 300 on the dji?? 😂💵🖨️
wing
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