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NEW YORK, NEW YORK - OCTOBER 15: A closed restaurant stands in New York City on October 15, 2020 in New York City. As American workers continue to struggle in an economy brought down by COVID-19, new jobless claims rose to 898,000 last week. It was the highest number since August 22 and represented a gain of 53,000 from the previous week’s upwardly revised total of 845,000.
Recent figures of people filing for unemployment benefits rose for the second consecutive week. The numbers jumped to 885,000 which prompted tighter distancing and safety measures on businesses and the public.
According to the Labor Department report, there is an increase of 23,000 individuals from the previous week, which marks the highest volume of weekly claims since the start of September.
It also shows that nine months after the virus paralyzed the economy, many employers are still slashing jobs.
The last week's jump comes on the heels of a large addition the week prior, and the notable rise in claims signals that the recovery of the labor market from the coronavirus-induced recession is stumbling.
Additional 455,000 individuals applied for benefits through the Pandemic Unemployment Assistance program, an aid which was created by the Congress for workers who will not qualify for the usual state benefits.
According to US News, the PUA program and another program that extended the unemployment benefits past the normal state cutoff were both set to expire at the end of the month unless Congress acts.
Moreover, top lawmakers are reportedly closing out a deal on another coronavirus relief package.
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The number of individuals continually receiving benefits, however, fell during the week ending December 5, which dropped by 273,000 to 5.5 million.
Jerome Powell, the Federal Reserve Chairman shared on Wednesday that the new surge in coronavirus cases was concerning and the upcoming months will likely prove extremely challenging.
He also added that it was too soon to determine when and how exactly the distribution of the vaccine will affect the economy.
Christopher Carlozzi, the state director of the National Federation of Independent Business, shared that it is difficult for many small businesses to maintain their workforce or even imagine hiring new workers when everything seems to be unsure.
He also added that with cities around Massachusetts rolling back more aggressively than the state, employers situated in the area seem to have no choice as they have to cut back staffing and reduce job opportunities, which also hindered the ability to recover the state, Washington Post reported.
Moreover, many unemployed Americans are collecting checks under two federal programs that are set to end the day after Christmas, unless Congress will act to extend the said aid, as the benefits will end completely for an estimated 9.1 million jobless people.
Glassdoor Senior Economist Daniel Zhao stated that the recent report shows that the jobs recovery we saw earlier this year is backsliding as the pandemic surges and employers lay off workers.
He also added that this only means that millions of unemployed Americans are increasingly relying on expanded unemployment programs that expire in a matter of weeks, Boston Herald reported.
While the unemployment claims continue to become a problem for the US economy, Congressional leaders are still struggling to reach a deal on the second wave of the coronavrus relief bill which may lighten the economic burden.
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