As the United States enters year three of the pandemic, the Labor Market continues to recover from the effects of COVID-19 and employment.
After months of steadily declining unemployment claims, the number of Americans filing for unemployment benefits unexpectedly rose to the highest level since mid-November as the omicron variant caused a surge in the number of COVID-19 cases.
On Thursday, the Labor Department released information showing that applications for unemployment benefits crept up to 230,000 from 207,000 from just a week earlier. This missed the prediction of applications set at 200,000 by analysts at Refinitiv.
The number of Americans who are consecutively receiving unemployment benefits fell to just under 1.6 million, which is a decrease of 194,000 from the previous week. This was the lowest level of continuing claims since March 2020, when the pandemic began.
During the week of December 25, approximately 1.948 million were collecting unemployment benefits, which was an increase of 226,264 from the week ending December 18, 2021. However, when comparing that number to the same week during the previous year, about 19.37 Americans were receiving unemployment benefits.
As the economy recovers and people are traveling once more, jobless claims are starting to mirror pre-pandemic numbers. However, businesses have struggled to keep up with the demand of customers who are once again eating out and shopping in-store. Businesses continue to report struggling to onboard new employees and keep them on the payroll. The report released on Thursday shows that businesses are making more of an effort to keep the employees that they already have.
Earlier this month, the Labor Department reported that there are about 10.6 million open jobs – at least at the end of November. This is a slight decline from October numbers. There are about 3.7 million more jobs than there are Americans looking for work.
However, Capitol Hill seems uneasy over the rise in cases driven by the omicron variant, which is highly contagious although most sufferers report the symptoms are mild. The United States is now reporting a 7-day moving average of over 122,000 cases of COVID-19, most likely the omicron variant.
At present, it is still unclear what the fast-moving variant will mean for the economy. Thousands of flights have been cancelled due to increased numbers of COVID. In Kansas, as schools struggle to stay open, the board of education has relaxed its requirements for those who wish to work as substitute teachers. The National Guard has been brought in to drive school buses in some states as the regular bus drivers are out with COVID. The White House continues to maintain that it has the resources available to deal with any disruptions caused by the new omicron variant.