U.S. labor market recovery on track as weekly jobless claims near 18-month low


By Lucia Mutikani, Reuters

via StreetInsider.com - September 9, 2021


WASHINGTON (Reuters) - The number of Americans filing new claims for jobless benefits fell to the lowest level in nearly 18 months last week, offering more evidence that job growth was being hindered by labor shortages rather than cooling demand for workers.


The weekly unemployment claims report from the Labor Department on Thursday, the most timely data on the economy's health, also showed the number of people on state unemployment rolls plunging to levels last seen in mid-March 2020 when the economy was reeling from mandatory shutdowns of nonessential businesses to slow the first wave of COVID-19 cases.


The continued downward trend in layoffs followed on the heels of a report on Wednesday showing job openings raced to a new record high in July, indicating a tightening labor market, which some economists argued could put pressure on the Federal Reserve to announce when it would start scaling back its massive monthly bond-buying program. Fed Chair Jerome Powell has offered no signal on when the U.S. central bank plans to cut its asset purchases beyond saying it could be "this year."


"There is likely to be a fierce debate at the coming Fed meeting on how tight the labor market is, but if policymakers focus on the most timely data we've got, they will realize that the labor market is close to meeting their more stringent criteria for an interest rate hike let alone the trigger for tapering," said Chris Rupkey, chief economist at FWDBONDS in New York.


Initial claims for state unemployment benefits dropped...