Starting in March 2020, new unemployment claims in the U.S. seemed to reach record levels every week as businesses closed all over due to the pandemic. And while that number has gradually been decreasing in recent months, thousands of people continue to file fresh unemployment claims each week. 719,000 workers filed for unemployment last week, an increase from 658,000 initial claims the week before.

Although the U.S. unemployment rate remains high, some experts are optimistic that the economy is on course for a gradual recovery. “Higher jobless claims in the most recent week don’t detract from the strong downward trend,” said economist Robert Frick. “March jobs numbers released tomorrow will reflect this trend, and we can expect jobless claims will fall quickly in April and through the spring generally.” In fact, the American economy added 675,000 jobs last month, a massive improvement from February’s tally of 379,000.

Of course, any talk of recovery depends on the continued success of the vaccine rollout in order to finally end the pandemic. “All of this is predicated on the trajectory of the virus,” said economist Constance Hunter. “If we can really get the virus under control, then we would expect to continue strong payrolls and at least one, if not two, really strong months of upside.” At the same time, the country still has a long way before it reaches full recovery: data shows that February 2021 had 9.5 million fewer jobs than the same month the previous year as more than 18 million people continue to draw unemployment payments. 

Questions:

1. Why do new unemployment claims in the U.S. remain high?
2. Do you think the U.S. economy will recover as the vaccine rollout continues? Why or why not?

Source: Amara Omeokwe, “U.S. Jobless Claims Remain Near Lowest Levels Since Covid-19’s Onset,” The Wall Street Journal, April 1, 2021.