Tech Stock Selloff Wipes Out a Week of Gains

The government reported on Thursday that 833,000 workers filed new claims for state unemployment benefits last week, the latest evidence that the coronavirus pandemic is still battering the labor market.

The figure, not seasonally adjusted, represents an increase from 826,000 the previous week. The seasonally adjusted number of new state claims last week was 881,000.

An additional 759,000 new claims were filed last week by unemployed freelancers, part-time workers and others who are receiving federal relief under a separate emergency relief program, up from 608,000 the week before.

There has been progress from the early weeks of the pandemic, when tallies surged past six million. But recent improvements have been more laborious.

“I’m really concerned that the pandemic assistance claims are rising,” said Gregory Daco, chief U.S. economist at the forecasting firm Oxford Economics. “Altogether you’re looking at 1.6 million filing. It’s pretty bad at this stage in the crisis.”

“I feel like this is a very fragile labor market at a critical juncture,” he added.

More than five months into the pandemic, the claims numbers continue to dwarf previous records.

“It could reflect a weakening economy in some of the states worst impacted by the health crisis,” he said, “or it could be that some of the workers that had returned are finding that it’s not possible or sustainable to return to their primary economic activity in the current environment.”

More than nine million laid-off workers have been rehired. And most analysts expect that the monthly jobs report, scheduled for release on Friday, will show a dip in August from double-digit unemployment rates.

There were modest reductions in new weekly claims through most of August, an encouraging trend. But this week, comparisons to previous announcements from the Labor Department need a flashing “WARNING” signal.

That’s because the department has changed the way it adjusts state jobless claims figures for predictable seasonal patterns, like school staff returning in the fall or temporary holiday workers who are laid off in January.

With the pandemic, claims have been anything but predictable. So the department tweaked its calculations to improve accuracy, but the change means that the seasonally adjusted numbers released on Thursday are not comparable with those from previous weeks.

As a result, The Times is emphasizing unadjusted figures.

Article source: https://www.nytimes.com/live/2020/09/03/business/stock-market-today-coronavirus