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Unemployment claims improve dramatically, drop to 13-month low

For 55 consecutive weeks, the number of Americans filing for unemployment benefits was worse than at any time during the Great Recession. Not anymore.
A person files an application for unemployment benefits on April 16, 2020, in Arlington, Va.Olivier Douliery / AFP via Getty Images file

As regular readers know, progress on weekly unemployment claims has been hit or miss in recent months, but the new report from the Labor Department is encouraging on multiple levels.

In the week ending April 10, the advance figure for seasonally adjusted initial claims was 576,000, a decrease of 193,000 from the previous week's revised level. This is the lowest level for initial claims since March 14, 2020 when it was 256,000. The previous week's level was revised up by 25,000 from 744,000 to 769,000. The 4-week moving average was 683,000, a decrease of 47,250 from the previous week's revised average. This is the lowest level for this average since March 14, 2020 when it was 225,500.

It was in March 2020 when jobless claims first spiked in response to the COVID-19 crisis, climbing to over 3 million. That weekly total soon after reached nearly 7 million as the economy cratered. For 55 consecutive weeks, the number of Americans filing for unemployment benefits was worse than at any time during the Great Recession.

As of this morning, that's no longer the case. It'd be a mistake to see 576,000 jobless claims as good news on its own, but given what Americans have been dealing with throughout the pandemic, it's evidence of amazing and overdue progress.

It's also not the only piece of encouraging economic news this morning. CNBC reported:

A fresh batch of stimulus checks sent consumer purchases surging in March as the U.S. economy continued to get juice from aggressive congressional spending. Retail sales rose 9.8% for the month, the Commerce Department reported Thursday. That compared to the Dow Jones estimate of a 6.1% gain and a decline of 2.7% in February.

About a month ago, as President Joe Biden signed the Democrats' $1.9 trillion COVID relief package, Senate Minority Leader Mitch McConnell (R-Ky.) scrambled to set public expectations. "The American people are going to see an American comeback this year," the GOP leader said, "but it won't be because of this liberal bill."

McConnell added, "We're about to have a boom. And if we do have a boom, it will have absolutely nothing to do with this $1.9 trillion."

It was foolish rhetoric for a variety of reasons, and as the economy picks up steam in response to the American Relief Plan, McConnell efforts to deny Democrats credit suddenly looks a little worse.

Update: There were a handful of other encouraging headlines this morning related to the economy: "Factory activity in the state of New York just hit its highest level since 2017; in Philadelphia, manufacturers are now more confident about business conditions than they have been since 1973. As of this writing, U.S. stock values have hit an all-time high. All of this news is better than expected. And yet the yield on U.S. Treasury bonds declined Thursday morning — a sign that global investors believe America can have its post-COVID economic boom and its low inflation, too."