According to the latest unemployment data released by the Department of Labor on Thursday, the number of Americans newly applying for unemployment benefits through state programs increased for the second week in a row in the seven days ended July 25. Seasonally adjusted initial claims climbed from 1,422,000 to 1,434,000 last week, as several states paused or reversed reopening due to a resurgence in coronavirus infections.
Coming at the heels of 15 consecutive weeks of declining initial claims, the latest reversal sparked fears of the jobs crisis dragging on for much longer than many had hoped. Even after 15 weeks of declines, the number of new jobless claims never dropped below one million. Prior to the COVID-19 pandemic, weekly claims had peaked at 695,000 in the fall of 1982, putting things in a bleak perspective.
With insured unemployment (through state programs) standing at 17 million for the week ended July 18, the jobs crisis is far from over. When asked about his expectation of how many of the latest job losses will turn out permanent in a FOMC press conference last month, Federal Reserve Chairman Jerome Powell said that it “could be well into the millions of people who don’t get to go back to their old job,” and that “it could be some years before we get back to those people finding jobs.”