US weekly jobless claims hit 13-month low; home sales tumble

WASHINGTON - The number of Americans filing new claims for unemployment benefits fell to a 13-month low last week, suggesting layoffs were subsiding and strengthening expectations for another month of blockbuster job growth in April as a re-opening economy unleashes pent-up demand.

While the labor market recovery is gaining speed, red flags are emerging in the housing market, the economy's star performer during the COVID-19 pandemic. Sales of previously-owned homes tumbled to a seven-month low in March as prices jumped to a record high amid an acute shortage of houses, other data showed on Thursday. Realtors warned that expensive homes could become a permanent feature of the market, worsening inequality.

Even as the economy is booming and the labor market scars are healing thanks to massive public aid from the government and increased COVID-19 vaccinations, there are still 17.4 million people collecting unemployment checks.

"We are seeing claims drop across most states, which shows the jobs recovery has become more geographically broad-based," said Robert Frick, corporate economist at Navy Federal Credit Union in Vienna, Virginia. "However, a growing number of Americans are out of work for longer, and it's those who are tougher to bring back into the labor force."

Initial claims for state unemployment benefits decreased 39,000 to a seasonally adjusted 547,000 for the week ended April 17, the lowest since mid-March 2020, the Labor Department said.

Economists polled by Reuters had forecast 617,000 applications for the latest week.

It was the second straight week that claims were below the 700,000 level since March 2020 when mandatory shutdowns of non-essential businesses like restaurants and bars were enforced to slow the first wave of COVID-19 infections. There were large declines in filings in Texas and New York, as well as decreases in several other states.

Claims have remained elevated because of fraud, especially in California and Ohio. The enhancement of the unemployment benefits programs, including a weekly $300 subsidy, could also be encouraging some people to attempt to file a claim for assistance, though not every application is approved.

The latest Labor Department data on first payments show only a fraction of claims were successful over the past months.

The weekly subsidy and the Pandemic Unemployment Assistance (PUA) program will run through Sept. 6. Claims jumped to a record 6.149 million in early April 2020. In a healthy labor market, claims are normally in a range of 200,000 to 250,000.

Including the PUA program, 699,798 people filed claims last week, squeaking below 700,000 for the first time since the pandemic started.

Stocks on Wall Street were mixed. The dollar gained versus a basket of currencies. US Treasury prices fell.

Reuters