Despite President Donald Trump's boasts about the America's economy, a new report from the Bureau of Labor Statistics reveals that initial unemployment claims rose to more than 1.1 million last week — suggesting the economy is still far from healthy.
"In the week ending August 15, the advance figure for seasonally adjusted initial claims was 1,106,000, an increase of 135,000 from the previous week's revised level," the Bureau of Labor Statistics wrote in a report on Thursday. This constitutes an increase of 135,000 from the rate on the previous week, which was revised upward in the recent report. Without being adjusted seasonally, the number of people who filed regular first-time claims for unemployment benefits in the week ending August 15 was 891,510. In a similar vein, claims for the Pandemic Unemployment Assistance program rose to 542,797.
This means that, overall, there were 1.4 million unadjusted first time claims last week.
The agency also noted that the advance seasonally adjusted insured unemployment rate had dropped by 0.4 percent from the previous week, now hitting 10.2 percent. The number of continued jobless claims — a statistic that includes people who have filed regular claims for at least two consecutive weeks — is currently at 14.8 million, enough to confirm that America is still experiencing an economic crisis but also the lowest level since the first week in April, near the start of the pandemic in the United States.
Andrew Stettner, senior fellow at The Century Foundation, told CNN that "it's clear that what is keeping people unemployed is not overly generous benefits, but a lack of job openings." Similarly Justin Wolfers, an economics professor at the University of Michigan, tweeted that "we are now at 22 weeks in a row in which more people have filed for unemployment benefits than during the single worst week of the Great Recession."
Despite rising unemployment and economic indicators that supplemental uninsurance benefits were providing the economy with a lifelife, Trump reduced the federal weekly supplement to existing unemployment benefits from $600 a week to $300 (which goes up to $400 if you include the amount that states have to kick in) and passed an eviction protection order that, experts say, did not protect Americans from eviction at all. The president continues to praise his economy, tweeting on Tuesday that "my Administration and I built the greatest economy in history, of any country, turned it off, saved millions of lives, and now am building an even greater economy than it was before. Jobs are flowing, NASDAQ is already at a record high, the rest to follow. Sit back & watch!"
Speaking to Salon in July — at a time when the economy seemed to be rebounding — American University macroeconomist Dr. Gabriel Mathy said that long-term unemployment could become a serious problem if the pandemic-induced recession drags on.
"For those that have permanently lost their jobs, if the recession drags on then they face the prospect of long-term unemployment, which will make it harder for these workers to find work again with a large hole in their CVs," Mathy explained by email. Although he said that this would not happen as much if the economy rebounded, he added that "there is the prospect for a recurrence of a new downturn ('double-dip recession') and then unemployment could rise again and job openings would dry up, and those permanent job losses could drag on."
Mathy also pointed out, "In terms of government programs that can help them, continuing the spending programs of the CARES Act will help ensure buoyant economic conditions and more job openings available."
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