A fresh snapshot of the labor market and the state of the economic recovery will arrive on Thursday when the Labor Department issues its weekly report on unemployment claims.
Amid a persistent drop in coronavirus cases, economists expect to see that new claims for state benefits ticked down again last week even as they remained extraordinarily high. While the economic crisis has probably peaked, they say, the lasting damage to the labor market is uncertain. That could become clearer in the coming months.
Unemployment claims “really have been at an elevated level for a long time,” said Diane Swonk, chief economist for the accounting firm Grant Thornton. “What’s going to be key going forward is do they plummet at some point in time or are there some longer-term issues?”
One marker that economists are watching is the number of people filing for extended benefits, an indication that they have exhausted their regular unemployment benefits, which last in many states for 26 weeks.
“What we’re concerned about is that more people who are falling out of regular claims are moving into extended claims,” said Gregory Daco, chief U.S. economist at Oxford Economics. “That is not a good sign.”
Congress continues to work on a $1.9 trillion relief package proposed by President Biden, but adding to the urgency is the expiration of supplemental unemployment benefits in mid-March. The Biden proposal would extend them through September.
There have been some positive signs for the job market in recent days. Retail sales surged 5.3 percent in January, a bigger gain than expected, most likely powered by the latest round of stimulus checks.
AnnElizabeth Konkel, an economist for the career site Indeed, said retail job postings on Indeed were 2.6 percent higher than in February 2020. Over all, job postings on the site are up 3.9 percent.
But the economy is still weak. The Labor Department’s employment report for January, which showed a gain of just 49,000 jobs, reaffirmed the pandemic’s devastation. Of the 22 million jobs that disappeared, roughly 10 million remain lost.
Thursday’s hearing about the recent GameStop trading mania, to be held at noon by the House Committee on Financial Services, will probably feature populist anger from both parties, directed at both the popular trading app Robinhood and the short sellers who targeted the video game retailer.
Representative Alexandria Ocasio-Cortez, a New York Democrat and a member of the financial services panel that is holding the hearing, called Robinhood’s decision amid the frenzy to halt some trades of GameStop “unacceptable.”…
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