With No New Stimulus On Horizon, Unemployed Rapidly Exhausting Benefits

Some 840,000 Americans filed initial unemployment claims last week, down 9,000 from the previous week's level and 460,000 filed for pandemic unemployment assistance, the 29th straight week of claims topping 1 million, the Labor Department reported Thursday.

The numbers do not include California, where authorities have paused reporting amid a backlog and efforts regarding police fraud.

The Bureau of Labor Statistics pegged the insured unemployment rate for the week that ended Sept. 26 at 7.5%.

“Even as a steady number of workers file new claims, increasing numbers of workers are exhausting their unemployment benefits," Andrew Stettner, senior fellow at the Century Foundation, told International Business Times in an email, noting the remaining provisions of the CARES Act expire Dec. 31. "The figures ... may even understate the problems."

President Donald Trump this week called off negotiations with Democrats on the next round of economic stimulus, pushing instead for separate bills dealing only with $1,200 checks to individuals, and aid to airlines and small businesses -- an approach House Speaker Nancy Pelosi rejected earlier.

The economy has recovered only about half the jobs it lost at the start of the pandemic with a new wave of layoffs getting underway.

The Labor Department report said unadjusted initial claims numbered 804,307 compared to 188,106 in the comparable week last year.

For the week that ended Sept. 19, more than 25.5 million people were collecting benefits from all programs, compared to 1.4 million in the comparable week of 2019.

“The suffering facing the unemployed still reaches far and wide, and the failure to provide any aid for American workers will reverberate throughout the economy," Stettner said. "For families depending on the lifeline of jobless benefits, the perils facing their families are likely to only get worse as we approach the cold fourth quarter end to 2020.”

"Putting a damper on forecasts for broad, near-term economic improvement are the rising numbers of COVID-19 cases in the U.S. and the dim prospects for further substantial federal relief legislation," Mark Hamrick, senior economic analyst at Bankrate.com, told IBT. "Many Americans are still facing the prospect of layoffs, and businesses of all sizes are facing the threat of failure, reduced sales and or capacity."

For the week that ended Sept. 19, the highest unemployment rates were reported in Hawaii, California, Nevada, Puerto Rico and the Virgin Islands.

For the week that ended Sept. 26, the largest increases in jobless claims were reported in Maryland, Illinois, New Jersey, Michigan and Massachusettes while the biggest decreases were in Texas, Florida, Georgia, New York and Oregon.