After reporting a significant increase in first-time claims for U.S. unemployment benefits in the previous week, the Labor Department released a report on Thursday showing initial jobless claims unexpectedly saw further upside in the week ended December 12th.

The report said initial jobless claims rose to 885,000, an increase of 23,000 from the previous week’s revised level of 862,000.

The continued increase surprised economist, who had expected jobless claims to drop to 800,000 from the 853,000 originally reported for the previous week.

With the unexpected increase, jobless claims climbed to their highest level since hitting 893,000 in the week ended September 5th.

“While hope is on the horizon as the coronavirus vaccine comes online, the labor market, for now, remains under a severe strain as Covid cases surge and restrictions on activity are put in place,” said Nancy Vanden Houten, Lead U.S. Economist at Oxford Economics.

The Labor Department said the less volatile four-week moving average also rose to 812,500, an increase of 34,250 from the previous week’s revised average of 778,250.

Meanwhile, the report said continuing claims, a reading on the number of people receiving ongoing unemployment assistance, fell by 273,000 to 5.508 million in the week ended December 5th.

The four-week moving average of continuing claims also slid to 5,726,250, a decrease of 215,500 from the previous week’s revised average of 5,941,750.


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