Last week, fewer than 200,000 Americans applied for unemployment benefits, marking the lowest total recorded since the same time period in 1969. While that low figure was the result of seasonal adjustments for the Thanksgiving holiday period, the four-week rolling average of 252,000 jobless claims is the lowest since mid-March 2020. That means layoffs are just about down to their pre-pandemic levels.
COVID-19 hit the job market hard in the spring of 2020, when employers laid off 22 million people in March and April. More than 33 million Americans were on some form of assistance in June 2020, the peak of the pandemic’s jobless claims. As recently as January, some 900,000 people were applying for unemployment weekly. But since spring 2020, the economy has added back 18 million of those jobs.
In stark contrast as the economy ramps up, employers are scrambling to find people to fill job vacancies. With more leverage than they’ve had in decades, workers are negotiating for higher wages and better benefits. If their current jobs can’t or won’t offer what they seek, Americans have quit by the millions in search of greener pastures.
Continuing jobless claims also fell and sit at just above 2 million, a sign the labor market remains tight and competition for quality workers will remain high in the near term.
With President Biden nominating Jerome Powell for another term as chair of the Federal Reserve, look for the Fed to continue its scaling back of bond purchases and at least one interest rate hike in the coming year.