Nearly 800,000 Americans filed for unemployment in the last week of 2020

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The number of Americans filing for aid stayed essentially flat the last week of 2020, as enhanced unemployment benefits kicked in for laid-off workers.

Roughly 787,000 people applied for unemployment the week ending January 2, the Labor Department said Thursday. That’s just 3,000 less than the previous week’s claims, which were revised up to 790,000. Another 161,000 applied for Pandemic Unemployment Assistance, a special federal program for self-employed, freelance and gig workers.

It’s the first time since March new unemployment claims, including for self-employed workers, fell below 1 million a week when accounting for seasonal adjustments. This year has seen a record number of announced job cuts, according to outplacement firm Challenger, Gray & Christmas. Some 2.3 million cuts were announced this year, nearly quadruple the figure for 2019.

“The underlying story here is clear. A combination of COVID fear and state-mandated restrictions on activity the sector is squeezing businesses, and no real relief is likely until a sustained decline pressure on hospitals emerges,” Ian Shepherdson of Pantheon Macroeconomics said in a research note.

Economists predict weekly unemployment claims will rise now that a $300 boost weekly benefits is available to the jobless. And while the economy is expected to recover quickly once vaccinations are broadly distributed, that point remains far in the future.

“While prospects for the economy later 2021 are upbeat, the economy and labor market will have to navigate some difficult terrain between now and then, and we expect claims to remain elevated,” economists at Oxford Economics said in a report.

Source: CBS NEWS