An update on the labor market’s health is due Thursday morning when the Labor Department is scheduled to release its weekly report on applications for government unemployment insurance.
Although new jobless claims are nowhere near the eye-popping levels seen last spring, they are still extraordinarily high by historical standards. There are roughly 10 million fewer jobs than there were last year at this time.
Wall Street analysts surveyed by Bloomberg expect a reduction in initial weekly claims for state jobless benefits.
Coronavirus caseloads have been dropping amid efforts to get vaccines to people who are most vulnerable. But until employers and consumers feel that the pandemic is under control, economists say, the labor market won’t fully recover.
“Until people feel this is sustained and that there’s not another huge wave coming, I can’t imagine we’re going to see big changes in jobless claims for a while,” said Allison Schrager, an economist at the Manhattan Institute.
Leaders at the Federal Reserve and Treasury Department have said the damage to the labor market is much deeper than has been reflected in published government figures, estimating that the true unemployment rate is closer to 10 percent than to the 6.3 percent recorded in the Labor Department’s most commonly cited measure.
Testifying before Congress this week, Jerome H. Powell, the Federal Reserve chair, said: “The economic recovery remains uneven and far from complete, and the path ahead is highly uncertain.”
Those hardest hit are in the service industry, particularly in restaurants, hospitality, leisure and travel. At the career site Indeed, job postings over all are 5 percent higher than they were a year ago, with demand greatest for warehouse and construction workers and drivers, said AnnElizabeth Konkel, an economist at the company.
“We need job postings to stay elevated above prepandemic baseline to pull people back into the labor market,” she said.
