WASHINGTON: The number of Americans who filed new claims for unemployment benefits to a three-month high, possibly as a winter wave of Covid-19 infection disrupting business activities, which can limit the growth of work this month.
The initial claims for state unemployment benefits surged 55,000 to 286,000 which were seasonally adjusted for the week ended January 15, the highest level since mid-October, the labor department said on Thursday.
The increase was the biggest since last July.
Claims have now increased for three consecutive weeks.
“Even with the usual noise in the number they seem to reflect a record of the Covid-19 case increase from Omicron,” said Robert Frick, a company economist at Navy Federal Credit Union in Vienna, Virginia.
“Fortunately Omicron peaked and if the past pattern survives, claims must go down quickly in the next two to three weeks.” Economists surveyed by Reuters have estimated 220,000 applications for the last week.
Uncatched claims fell 83,418 to 337,417 last week.
The decline, however, less than 138,773 declines that have been anticipated by seasonal factors, are used by the government to trace seasonal fluctuations from data.
Claims rose 6,075 in California.
But they dropped 14,011 in New York.
There are also big drops in Missouri and Texas.
The United States reported an average of 732,245 new Koronavirus infections a day, according to Reuters analysis of official data, in a winter surge driven by the Omicron variant.
However, there were signs that cases began to subside in several regions, including Hard-Hit New York.
Claims can begin lower trends as infections decrease.
However, the labor market conditions are tightening.
Claims have plunged from a record high of 6.149 million in early April 2020.
Employers desperate for workers, with 10.6 million job openings at the end of November.
The unemployment rate is at a 22-month low of 3.9%, a labor market sign on or close to maximum work.
Claim data includes a period where the government surveys businesses for nonfarm payrolls components from employment reports in January.
Claims are significantly higher than their level in mid-December.
Lack of workers and disorders caused by omicron through attendance, reducing operations or temporary business closure, can lead to moderate fixed salary increases this month.
The economy added 199,000 jobs in December, at least a year.
The workforce is around 2.2 million people smaller than before the pandemic.
The claim report shows the number of people who received the benefits after the initial week of aid increased by 84,000 to 1.635 million in the week ended on January 8, which was called continuous claims to remain below 2 million for the eighth week.