Labor market is moving in the wrong direction
More than 1 million Americans filed for unemployment benefits for the first time last week, even as new applications for the Pandemic Unemployment Assistance program fell to their lowest level since March.
State of play: The $900 billion stimulus bill passed by Congress at the end of December extended the PUA program through at least March but also added a new verification process that forces applicants to reapply in order to reduce fraud.
- That and President Trump's delay in signing the bill is likely why the number of first-time PUA claims fell from more than 310,000 for the week ending Dec 26 to 161,400 during the week ending Jan. 2, Heidi Shierholz, senior economist and director of policy at the Economic Policy Institute, tells Axios.
- That created "uncertainty/confusion about whether PUA would even exist," she says. "I assume the drop is temporary."
The intrigue: Seasonal adjustment caused another divergence in data, bringing the total number of claims down by 126,000 from the previous week, while the number of claims without accounting for seasonal factors rose by 145,000.
Yikes: Annual data from Challenger, Gray & Christmas found total layoffs in 2020 hit a record 2.3 million, a 289% increase from 2019.