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The numbers: The number of new applications for U.S. unemployment benefits rose to a one-month high of 770,000 in mid-March, reflecting some of the damage caused to the Texas economy by a winter freeze.
Initial jobless claims filed traditionally through the states increased by 45,000 to 770,000 in the week ended March 13, the government said Thursday.
Economists surveyed by Dow Jones and The Wall Street Journal had forecast new claims would fall to a seasonally adjusted 700,000.
Another 282,394 applications for benefits were filed through a temporary federal-relief program. These numbers are unadjusted.
Combined state and federal jobless claims totaled 1.02 million last week. They’ve yet to fall below 1 million since the onset of the pandemic last year, underscoring the massive damage to the U.S. economy caused by the coronavirus.
Read: Inflation worries are back. Should you worry?
What happened: Actual or unadjusted jobless claims surged 21,000 to more than 70,000 in Texas, making it the state with the largest increase.
A massive winter storm that froze over the state and temporarily shut down much of its economy in February is still having lingering effects. Widespread power outrages prevented many people for applying for benefits until after the crisis.
New claims also rose sharply in Illinois and Virginia. Most other states report little change or outright declines.
The number of people already collecting traditional unemployment benefits, meanwhile, slipped a mild 18,000 to a seasonally adjusted 4.12 million. That’s the lowest level since last spring.
The decline is not quite as steep as it seems, however. An additional 4.82 million people who have exhausted state compensation were getting temporary benefits through an emergency program funded by the federal government.
Altogether, the number of people reportedly receiving benefits from eight separate state and federal programs was reported at an unadjusted 18.2 million as of Feb. 27.
By contrast, fewer than 2 million people were getting benefits before the pandemic erupted.
Note to readers: A government review found the number of distinct individuals collecting benefits has been inflated by fraud and double counting. Economists say to pay attention to the direction of claims instead of the totals.
Read: Jobless claims inflated, GAO finds
The big picture: The rise in claims last week is unlikely to last.
Texas is recovering, for one thing, and companies across the country are either laying off fewer workers or looking to hire as the economy speeds up. A massive $1.9 federal stimulus will add a further boost along with increasing vaccinations and a sharp decline in coronavirus cases.
Read: The economy is ready to rip after stimulus and faster vaccinations
If the pandemic fades away, economists predict the U.S. could add as many as 7 million jobs this year and push employment close to pre-coronavirus levels.
Yet it will probably take a few years to erase all the damage done to the labor market. The U.S. is still missing some 10 million jobs that existed before the pandemic.
See: A visual look at how an unfair pandemic has reshaped work and home
What they are saying? “The combination of spring weather and increased vaccine distribution should further improve the labor market, but it’s unclear how much of a boost that will be,” said Indeed Hiring Lab economist AnnElizabeth Konkel. “Only once the public health situation is under control can a full recovery take place.”
Market reaction: The Dow Jones Industrial Average
DJIA,
and S&P 500
SPX,
were set to open lower in Thursday trades.
