Initial Unemployment Claims Fall To 281,000, Continuing Downward Trend

The number of initial unemployment claims in the U.S. has fallen for a third week in a row and slowly creeps closer to pre-pandemic lows, the Department of Labor reported on Thursday.

First-time filings for unemployment benefits totaled 281,000 for the week ending Oct. 23, down 10,000 from the previous week’s tally of 291,000. This figure was revised up from an earlier estimate of 290,000.

October has seen the number of initial unemployment claims steadily fall after weeks of precipitous increases throughout September. These new figures show that the economy may be adjusting to the end of federal unemployment benefits on Labor Day. It is also evidence that the U.S. economy is still slowly walking down the road to recovery, despite a deeply disappointing jobs report for last month.

Continuing unemployment claims fell to their lowest level since the start of the COVID-19 pandemic. The Labor Department measures these numbers for the week preceding those for initial unemployment claims, and it found a total of 2,830,661 are still receiving benefits as of Oct. 9. This is a decrease of 448,386 from the previous week and far below the 23,479,913 weekly claims filed in the comparable week in 2020.

These numbers arrive as policymakers are more focused on the dangers of rising inflation and the continuing labor shortage. The latest Consumer Price Index released on Oct. 13 showed prices for goods, particularly food, rent and energy, rose as year-on-year inflation was 5.4%, the highest since January 1991. Meanwhile, companies continue to report not having enough workers to fill vacancies, further pushing up prices.

Federal Reserve officials, including Chairman Jerome Powell, have signaled that they are unlikely to raise interest rates yet, but they are expected to announce the start of their tapering of the multibillion-dollar asset purchasing program. It is hoped that by reducing the purchases, the central bank can put a dent in inflation.