By Sarah Chaney Cambon 

Unemployment claims likely resumed their decline as the U.S. economic revival picked up speed.

Economists surveyed by The Wall Street Journal expect that the Labor Department will report that jobless claims, a proxy for layoffs, fell to 710,000 last week from 744,000 a week earlier.

That would be down from a recent high of about 900,000 a week in January, but still way above the levels of around 220,000 that prevailed early last year, before the Covid-19 pandemic hit the U.S. economy.

"The labor market is on a recovery path," said AnnElizabeth Konkel, economist at the job site Indeed. "The recovery is 100% tied to the public health situation," she added.

The economy is showing signs of improvement as vaccination rates power consumer spending, governments relax restrictions on businesses, and households and federal-stimulus funds flow through the economy.

U.S. employers added 916,000 jobs in March, and the jobless rate edged down to 6%, from 6.2% in February. Consumers are spending more on gyms, restaurants, hotels and other services that they had shunned over the past year. The Commerce Department is due to release March retail-sales data on Thursday.

Jobless claims have been especially choppy during the pandemic. States have struggled to process historically high numbers of claims, creating backlogs. Many have also struggled with unemployment-insurance fraud, which can distort weekly claims counts.

"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," wrote Nancy Vanden Houten, lead economist at Oxford Economics, in a note to clients.

The number of people receiving unemployment assistance is slowly declining as the labor market heals.

The labor market still has a long way to go before achieving a full recovery. As of March, U.S. payrolls remained 8.4 million below their level in February 2020.

Many workers are also facing long spells of joblessness. About 5.6 million Americans who exhausted their regular state benefits were drawing on extended benefits through a federal program in mid-March.

President Biden recently signed a $1.9 trillion relief package into law that provides stimulus checks to many households and extends supplemental jobless benefits originally set to expire March 14. Workers claiming unemployment benefits can now receive an additional $300 a week through early September.

Write to Sarah Chaney Cambon at


(END) Dow Jones Newswires

April 15, 2021 05:44 ET (09:44 GMT)

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