Weekly jobless claims rose to 744,000 for the week ending April 3, the Department of Labor reported Thursday.
This is the second week in a row that initial jobless claims moved up contradiction expectations. Economists forecasted a decline to 680,000 from 719,000 the previous week. The upper end of the range of forecasts in the Econoday survey was 705,000.
Claims for unemployment benefits recently fell to a pandemic-era low. But they rose again last week, muddying the picture of the US jobs recovery.
Another 744,000 American workers filed first-time claims for unemployment benefits on a seasonally adjusted basis, according to the Labor Department. It was an increase from the week before, but more notably, it was far more claims than economists had predicted.
Economists like to look at the four-week average as jobless claims can be volatile week to week.
Continuing claims, reported with a week’s lag, fell to 3,734,000, a decrease of 16,000 from the week ended March 27.
Including new programs for gig workers and small business owners, the total number of continued weeks claimed for benefits in all programs for the week ending March 20 was 18,194,588, a decrease of only 50,862 from the previous week according to the most recent data available.
Record-breaking claims reached 6.87 million for the week of March 27, more than ten times the previous record.
Many states eased or eliminated restrictions on businesses, including restaurants and bars, in March. Forty-three states are now mostly open. This has led to a surge in economic activity. The American Rescue Act authorized $1.9 trillion of stimulus money. However, only a tiny fraction of that has been spent so far.
“Jobless claims may bounce around week to week as the recovery takes hold, but we expect they will start to decline more consistently as the economy gains momentum,” Nancy Vanden Houten, lead economist at Oxford Economics, wrote in a note to clients.
She expects a hiring boom in the spring and summer as more businesses fully reopen
But infections have recently been rising, which could be a piece of bad news to workers seeking employment and hiring.