The number of Americans submitting new claims for unemployment benefits unexpectedly rose last week even as the labor market recorded a recovery driven by brisk economic activity, increased vaccinations and substantial fiscal stimulus.
Initial claims for unemployment benefits were 719,000 for the week ended March 27 based on a report released by the Department of Labor on Thursday.
This reading is up from the previous week which saw a total of only 658,000 claims, the lowest figure since mid-March 2020. Where in March last year, the government imposed a curfew and caused many economic sectors to close to curb the spread of the Covid-19 outbreak.
This reading also exceeded the expectations of experts who predicted only 680,000 applications. A $ 1.9 trillion pandemic aid package from the White House will send an additional $ 1,400 in checks to eligible households and extend the government’s stimulus for the unemployed until Sept. 6 to boost consumer spending.
According to economic observers, the labor market is still far from a full recovery. Unemployment claims remain above the 665,000 peak recorded during the economic recession in 2007-2009. In a healthy labor market, the number of claims is usually in the range of 200,000 to 250,000.
Even so, a Reuters survey found NFP data is expected to increase by 647,000 jobs last month.
