The number of Americans applying for initial unemployment benefits totaled 1.54 million in the week ending June 6, the U.S. Labor Department said Thursday, while the number of continuing claims remained above 20 million, reinforcing the view that the labor market could take years to recover from the pandemic even as businesses re-open.
The initial claims number was slightly better than forecasts for 1.55 million and was down from 1.89 million in the prior week. Claims have been gradually decreasing since hitting a record 6.86 million in the week ended March 28.
Continuing claims, which show the number of people receiving benefits after an initial week of aid, came in above expectations at 20.92 million in the week ended May 30, down slightly from 21.26 million a week earlier.
Continuing claims figures are reported with a one-week delay but are considered offering a better view of the labor market. Continuing claims have eased from a record high of 24.91 million in early May.
That decline has been attributed to the government’s Paycheck Protection Program, part of a historic fiscal package worth nearly $3 trillion, that offers businesses loans that can be partially forgiven if used for employee salaries.
The latest jobless claims report comes after data last Friday showing a surprise 2.5 million increase in nonfarm payrolls in May.
The Federal Reserve indicated Wednesday it would provide years of extraordinary support for the economy, with policymakers projecting a 9.3% unemployment rate at year end. The unemployment rate has jumped from 3.5% in February and was at 13.3% in May.
“The steady retreat in claims is a positive development, but the labor market has suffered a traumatic blow and a full recovery will be measured in years, not weeks or months,” said Nancy Vanden Houten, lead U.S. economist at Oxford Economics in New York. “The figures don’t capture the full extent of the blow dealt to workers during this unique crisis.”