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First Cut: Initial jobless claims levels start to stabilize in recent weeks, but another increase could be on the horizon

Initial jobless claims fell an unadjusted 14,575 to 1.446 million in the week ended June 27. New filings for benefits were down for a 13th week in a row, but the pace has slowed significantly in the last couple of reports. However, with some regions where COVID-19 infections are on the rise, fresh restrictions on business could mean that layoffs are going to start climbing again and with them new filings for benefits.

Beyond the now usual mention of COVID-19 as a driver in claims data, the Labor Department cited no special factors. The only state to estimate claims was Michigan.

Unadjusted insured unemployment claims were up 266,351 to 17.921 million in the June 20 week. This hinted that those businesses that were going to recall workers had pretty much done so, and that fresh claims were moving on to the rolls of approved and continuing claims. The unadjusted insured rate of unemployment was up two-tenths to 12.3% in the June 20 week and supported the idea that unemployment was not coming down after the improvement in prior weeks.

Claims for Pandemic Unemployment Assistance (PUA) in the week ended June 27 were down 41,679 to 839,563. Ongoing benefits from PUA in the June 13 week were up 1.786 million to 12.853 million. This program for workers not covered by unemployment insurance continued to get plenty of traffic. Claims for the Pandemic Emergency Unemployment Compensation (PEUC) for workers whose other benefits have been exhausted were down 102,280 to 749,703 in the June 13 week. These programs are of limited duration and claimants are starting to time out of eligibility.

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