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Jobless Claims Hit Their Lowest Level Since March — What This Means for the Economy

The number of new unemployment applications unexpectedly fell below the 800,000 mark last week — a sign of improvement for the battered United States labor market.

According to the Department of Labor, initial jobless claims for the week ended Oct. 17 totaled 787,000 — a decrease of 55,000 from the previous week’s downwardly revised 842,000 filings. Economists had forecasted 875,000 applications last week.

The data also showed that continuing claims, which paints a broader picture of unemployment in the country and lags jobless numbers by one week, declined by roughly 1.02 million to 8.37 million, versus the prior week’s downwardly revised 9.4 million filings.

Weekly applications for unemployment have dropped significantly since peaking at 6.9 million in late March. However, last week’s report for the period ended Oct. 10 — which showed the highest number of claims since Aug. 22 — signaled that there could still be a long way to go before recovery is consistent.

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For more than a month, the number of jobless applications had hovered over 800,000. The latest Labor Department tally shows that filings have hit their lowest level since the coronavirus pandemic took hold in the U.S., when millions of people were furloughed or laid off as government-imposed lockdowns forced the closures of nonessential businesses like stores, restaurants and other services. (Until mid-March, weekly applications held at about 200,000. The previous record for most claims filed came in October 1982 and was 695,000.)

With Election Day less than two weeks away, many Americans are hoping for a new stimulus that could infuse financial aid into the struggling U.S. economy. However, Washington lawmakers have yet to settle on an agreement: Over the weekend, House Speaker Nancy Pelosi had set a deadline to reach an agreement with the White House on Oct. 20 in order to get a bill passed through both chambers of Congress by Nov. 3. That deadline has since passed, and any proposal would likely get a vote during a lame-duck session.

According to reports, the latest stimulus package under discussion could cost the government between $1.8 trillion and $2.2 trillion. Both Democrats and Republicans have said that they favor providing another round of direct payments to individuals and families, as well as continuing additional unemployment benefits though they have differed significantly on amounts.

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