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Initial Claims Rise Again but the Outlook for Jobs Remains Positive

Initial claims for regular state unemployment insurance totaled 744,000 for the week ending April 3, up 16,000 from the previous week’s upwardly revised tally of 728,000 (see first chart). Despite a second consecutive uptick, the outlook for jobs and the economy has been improving as government restrictions on consumers and businesses continue to be lifted.

The four-week average rose 2,500 to 723,750, the first increase since January. Despite the increase, it is likely to continue trending lower as the combination of vaccine distribution and easing government restrictions on consumers and businesses slowly push the economy closer to normal operation. However, significant damage has been done by the lockdowns and full recovery is likely several quarters away.

The number of ongoing claims for state unemployment programs totaled 4.068 million for the week ending March 20, down 132,454 from the prior week and the lowest since the lockdowns began in March 2020. Continuing claims for state programs remain in the 4 to 6 million range but have been trending lower over the last three months and are close to breaching the lower bound (see second chart).

Continuing claims in all federal programs totaled 14.097 million for the week ending March 20, a rise of 81,592 (see second chart). Since the beginning of June 2020, continuing claims in all Federal programs have been in the 12 to 16 million range, averaging 14.088 million.

The total number of people claiming benefits in all unemployment programs including all emergency programs was 18.165 million for the week ended March 20, down 50,862 from the prior week. Total claims have been in the 16 to 20 million range since November (see second chart).

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