An additional 1.5 million workers filed for unemployment benefits for the first time last week, a drop of 58,000 claims from the week before.
The continued elevated level of jobless claims raises new questions about whether steep job losses during the pandemic could last longer than hoped, economists say.
This year, amid the novel-coronavirus pandemic, there have been 13 straight weeks in which more than 1 million people have filed for unemployment for the first time. In February, before the virus took hold in the United States, the weekly jobless claims were about 200,000 a week. The previous record was 695,000 in 1982.
Hopes that the reopening of businesses that had been forced to close would see jobless numbers drop precipitously, helping to speed the economy's recovery at a comparable rate to its fall. But such a "V-shaped" recovery does not appear to be materializing as job losses remain severe several months into the pandemic.
Another 760,000 people filed initial claims for Pandemic Unemployment Assistance, a supplemental program created by Congress for self-employed and gig workers. And the total number of people receiving benefits fell slightly, to 20.5 million. More than 45 million people have filed for unemployment at some point during the pandemic.
Analysts said the weekly numbers pointed to steep challenges the country faces in its recovery.
"The fact that we're not seeing a huge decline in continuing claims as the economy starts to reopen suggests that firms in directly affected industries are only partially recalling some employees," said Nick Bunker, an economist at Indeed Hiring Lab. "And that's not going to lead to a huge snap back."
"We all looked for confirmation of hopes that these claims would continue to decline," said Mark Hamrick, a senior economic analyst at Bankrate. "But we see the decline was just [over] 50,000. That's less of an improvement we've seen in recent weeks."
The economic outlook is complicated by continuing coronavirus outbreaks across the country: Twenty-one states are seeing an increase in their daily average of new coronavirus cases this week compared to last week, according to data compiled by The Washington Post. New infections surged nationwide.
The numbers of people heading back to work or gaining new jobs has kept pace nominally with those still filing for unemployment for the first time, raising questions about whether the recovery is stalling.
The weekly unemployment insurance data remains an imperfect measurement. It does not capture which industries shed jobs or why, nor does it necessarily reflect the exact time period a person filed for unemployment benefits - instead revealing the time a state first processed the claim. So there are unanswered questions about whether some of the backlogs that plagued state unemployment agencies early in the crisis are still being worked through, affecting the data.
Attempts to battle wide-scale fraud have slowed application processing in states including Maine, Michigan, Pennsylvania and Washington. In Kentucky, hundreds of people lined up outside of the Capitol on Wednesday, seeking help with stalled claims in an estimated eight-hour wait, some of the tens of thousands who have had trouble with their claims in the state.
President Donald Trump and his economic team have expressed hopes of a swift recovery. And the most optimistic forecasters have suggested that as the economy reopens, businesses that had forcibly shuttered will be able to bring back their workers. But Bunker, of Indeed, said the pace of rehiring was slowing even as the country opens up.
"In the May jobs report we saw an increase in employment and a drop in unemployment rate due to an increase in businesses that got hit really hard initially," he said. "What we may be seeing now is that pace of rehirings is slowed or that the recovery could be stalling out, but it's not 100% clear from the data."
There have been other positive indications: Retail sales spiked 17.7% in May, though they continue to be down nearly 8% since February.
But analysts and key economic leaders such as Federal Reserve Chair Jerome Powell continue to warn that despite bright signs, the economic pain could be deep and long lasting for many sectors of the economy.
The unemployment rate remains the highest it has been since the Great Depression. The official rate for May was 13.3%, but the Bureau of Labor Statistics said that it would have been closer to 16.3% if not for an error in the data collection process.
Since February, nearly 20 million jobs have been lost and the unemployment rate has risen about 10 percentage points, Powell told a Senate committee this week. He said the decline in a key measure of economic growth, gross domestic product, during this pandemic is likely to be the most severe on record.
There are other problems on the horizon. The $600 weekly supplement for unemployed workers will end by August. Unemployment benefits could also begin to expire for workers after the summer in some states with shorter durations allowed on unemployment insurance.
This article was written by Eli Rosenberg, a reporter for The Washington Post.