(Bloomberg) — U.S. applications for state unemployment benefits had little change from their high levels in the last week of 2020, indicating that the labor market remains affected by the continuity of the pandemic.

Initial applications for unemployment in regular state programs fell by 3,000 to 787,000 in the week ended January 2, according to data from the Department of Labor on Thursday. On an unsosed basis, the figure increased by 77,400.

Continued applications in state programs, an approximation of the number of people receiving these benefits, decreased by 126,000 to 5.07 million in the week ended December 26. Bloomberg’s survey of economists predicted 800,000 initial state applications and 5.2 million continuous applications on an adjusted basis.

© Bloomberg Initial U.S. unemployment applications fall for third week

Data tends to be more volatile around weeks with festivities, such as Christmas and the New Year.

While initial applications fell for the third week in a row, the figures show an uptick in the labour market that remains fragile, and Friday’s job report would forecast a sharp slowdown in recruitment in December. The increase in covid-19 cases led to a wave of renewed restrictions on business and economic activity, leading companies to cut jobs.

“The current wave of contagion is affecting activity,” Michael Feroli, chief economist for the U.S. at JPMorgan & Chase Co., told Bloomberg Television on Thursday. “What we see is very clear. It is a noticeable slowdown in the labour market over the past few weeks.”

Stocks opened upwards and yields on 10-year Treasury bonds rose after the report, as investors focused on the prospect for greater economic stimulus and the likelihood that calm will prevail when Joe Biden assumes the presidency after the violence evidenced Wednesday at the U.S. Capitol.

The recently signed $900 billion pandemic aid package will provide some relief to workers and businesses waiting for widespread vaccines. The law extended unemployment benefits to millions of Americans about to lose such financial support by the end of 2020. It also provided an additional $300 per week in unemployment aid through mid-March.

Uno de los programas que expirará, la asistencia de desempleo por la pandemia (PUA, por sus siglas en inglés), recibió 161.460 solicitudes iniciales la semana pasada, un descenso de casi 50% con respecto a la semana anterior. El programa proporciona beneficios por desempleo a aquellos que generalmente no son elegibles, como los trabajadores independientes y los trabajadores de la economía “gig”. Hubo 8,38 millones de semanas continuas solicitadas para esta asistencia en la semana que terminó el 19 de diciembre, ligeramente por debajo de la semana anterior.

En la misma semana, hubo 4,52 millones de solicitudes continuas para la compensación de desempleo por emergencia pandémica, que proporciona beneficios por desempleo extendidos para aquellos que han agotado sus beneficios estatales regulares. Al igual que PUA, el programa federal iba a expirar a fines de 2020 si el Congreso no hubiera actuado. El número de estadounidenses que se consideran desempleados de larga duración alcanzó un máximo de siete años en cerca de 4 millones en noviembre.

Original Note:

U.S. Initial Jobless Claims Remains Elevated Heading Into 2021