U.S. Unemployment Claims Likely Edged Lower
January 28 2021 - 5:59AM
Dow Jones News
By Hannah Lang
The number of workers seeking unemployment benefits likely
declined but remained elevated last week, as the labor market
struggles through a pandemic-driven winter slowdown, forecasters
said.
Economists surveyed by The Wall Street Journal estimated that
875,000 unemployment claims were filed last week, down slightly
from about 900,000 a week earlier.
Weekly applications for unemployment claims, a proxy for
layoffs, have remained for months well above the pre-pandemic peak
of 695,000 and are higher than in any previous recession for
records tracing back to 1967.
"The virus is in the driver's seat--there's no getting around
it," said Daniel Zhao, senior economist and data scientist at
Glassdoor, a company-ratings and job-listings website. "Until we
control the pandemic, we can't hope for a full recovery
economically."
Weekly jobless claims are volatile but have generally trended
higher since November, when they were below 800,000, to 926,000
during the week of Jan. 9. They point to a slowing economic
recovery, as surging coronavirus case numbers, fresh safety
restrictions and colder weather hamper the labor market's recovery
from the initial shock of the pandemic last spring. Employers cut
140,000 jobs nationwide in December, with gains in many industries
more than offset by losses at restaurants, bars, hotels and other
businesses related to leisure and tourism.
When the coronavirus outbreak triggered widespread shutdowns and
business restrictions last spring, Samantha DiStefano, owner of
Mama Fox bar and restaurant in Brooklyn, said she laid off her
entire staff of about 20 employees. During the summer, when new
cases in New York were low and outdoor dining more feasible, she
returned to pre-pandemic staffing levels, she said. But the
holidays brought colder temperatures and fewer customers. Now,
she's back to just a handful of employees.
"Things started getting quiet, and then they fell off a cliff by
the Thanksgiving holiday," she said. "Everyone's been getting their
hours cut."
Still, the distribution of the Covid-19 vaccine and falling case
numbers across the country might mean a light at the end of the
tunnel, Mr. Zhao said.
"There is a case for cautious optimism that the economy will
start to recover more quickly in the spring, and then could even
rebound faster once the vaccine is widely distributed," he
said.
At DiStefano's restaurant, sales are just a quarter of what they
were last winter, before the pandemic struck, she said. She is
hopeful for the spring, when milder weather might lure more diners
and she can hire more wait staff. But it will take much longer for
New York's hospitality businesses to recover, she said.
"Even if revenue goes back to normal, it's going to be years
before we can get the ship straight again," Ms. DiStefano said.
Write to Hannah Lang at Hannah.Lang@wsj.com
(END) Dow Jones Newswires
January 28, 2021 05:44 ET (10:44 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.