New US Jobless Claims Rise to 885,000

New unemployment benefit claims in the US rose to 885,000 last week; the highest weekly increase seen since September. As the coronavirus resurges around the country, many businesses have been forced to lay off workers, threatening the economy which had begun to recover from the impact of the spring shutdowns.

Before the pandemic began, new weekly unemployment claims numbered around 225,000. With restaurants and many businesses forced to shutter or reduce capacity and operating hours amid the huge spike in cases nationwide, many are feeling the impact of job insecurity. Last week’s jobless claims exceeded what economists predicted to be around 800,000.

The number of American’s receiving state funded unemployment benefits fell from 5.8 million to 5.5 million, which is sharply lower than the 23 million unemployment recipients reported last May. That number could be indicative of those who have exhausted the traditional 6-month benefit period.

Jobless Americans are hoping the new stimulus package will include extending the $300 weekly federal payment, which is set to expire one day after Christmas. Unless the government comes to an agreement, benefits will be completely cut off for over 9 million people who have been relying on one of the two supplemental payments. The first one covers gig workers and those who do not qualify for regular unemployment benefits. The second one provides 13-weeks of payments for those who have exhausted their state unemployment benefits, which recently rose to 4.8 million. In total, 20.6 million Americans currently rely on some form of unemployment assistance.