May 6, 2021 Reading Time: 2 minutes

Initial claims for regular state unemployment insurance totaled 498,000 for the week ending May 1, a drop of 92,000 from the previous week’s upwardly revised tally of 590,000 (see first chart). The current result is the lowest level since March 14, 2020 and continues to suggest an improving outlook for the labor market and overall economy.

The four-week average fell 61,000 to 560,000, the fourth consecutive week below 700,000 and first week below 600,000 since March 14, 2020. Initial claims are likely to continue trending lower as the combination of vaccine distribution and easing government restrictions on consumers and businesses push the economy closer to pre-pandemic levels of activity.

The number of ongoing claims for state unemployment programs totaled 3.756 million for the week ending April 17, down 57,150 from the prior week. The latest reading is the fourth consecutive week below 4 million and the lowest since the lockdowns began in March 2020 (see second chart).

Continuing claims in all federal programs totaled 12.401 million for the week ending April 17, a drop of 347,359. Since the beginning of June 2020, continuing claims in all Federal programs have been in the 12 to 16 million range, averaging 13.979 million. Federal continuing claims have fallen in four of the last six weeks since March 6, hitting the second-lowest level since June 6, 2020 (see second chart).

The total number of people claiming benefits in all unemployment programs including all emergency programs was 16.157 million for the week ended April 17, down 404,509 from the prior week. Total claims have been in the 16 to 20 million range since November but have fallen in five of the last six weeks and are at the second-lowest level since April 4, 2020 (see second chart).

Robert Hughes

Bob Hughes

Robert Hughes joined AIER in 2013 following more than 25 years in economic and financial markets research on Wall Street. Bob was formerly the head of Global Equity Strategy for Brown Brothers Harriman, where he developed equity investment strategy combining top-down macro analysis with bottom-up fundamentals. Prior to BBH, Bob was a Senior Equity Strategist for State Street Global Markets, Senior Economic Strategist with Prudential Equity Group and Senior Economist and Financial Markets Analyst for Citicorp Investment Services. Bob has a MA in economics from Fordham University and a BS in business from Lehigh University.

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