The number of Americans filing new claims for unemployment benefits fell close to pre-pandemic levels last week as the labor market recovery continues, though a shortage of workers remains an obstacle to faster job growth.
The weekly unemployment claims report from the Labor Department on Thursday, the most timely data on the economy’s health, also showed jobless benefits rolls declining to a 20-month low in early November. The economy is regaining momentum following a lull over the summer as a wave of COVID-19 infections driven by the Delta variant battered the nation.
“Demand for labor is very strong and workers are in short supply, so layoffs are very low right now,” said Gus Faucher, chief economist at PNC Financial in Pittsburgh, Pennsylvania.
Initial claims for state unemployment benefits slipped 1,000 to a seasonally adjusted 268,000 for the week ended Nov. 13. That was the lowest level since the start of the coronavirus pandemic in the United States more than 20 months ago.
Economists polled by Reuters had forecast 260,000 applications in the latest week. The smaller decline was because the model that the government uses to strip out seasonal fluctuations from the data was less generous last week.
Unadjusted claims dropped 18,183 to 238,850. The decrease was led by Kentucky, likely due to automobile workers returning to factories after temporary layoffs as motor vehicle manufacturers deal with a global semiconductor shortage. There were also big declines in Michigan, Tennessee and Ohio, states that also have a strong presence of auto manufacturers.
The decreases offset a surge in filings in California.
The seventh straight weekly decline left claims just above the 256,000 level in mid-March 2020, and in a range that is associated with a healthy labor market. Claims have declined from a record high of 6.149 million in early April 2020.
The improving economic tone was matched by other data from the Philadelphia Federal Reserve on Thursday showing an acceleration in manufacturing activity in the mid-Atlantic region this month.
Factories in the region that covers eastern Pennsylvania, southern New Jersey and Delaware, reported strong order growth. They were upbeat about business conditions over the next six months and anticipated maintaining a strong pace of capital expenditures in 2022. But labor and raw material shortages persisted, leading to a rapid piling up of unfinished work, even as manufacturers increased hours for workers.
Factories continued to face higher prices for inputs, which they passed on to consumers.
“We look for voracious goods demand and a plethora of unfilled orders to keep factories pumping out goods at a very healthy pace,” said Oren Klachkin, lead U.S. economist at Oxford Economics in New York. “We also expect that businesses will continue to face major supply-chain problems next year, though headwinds should start to ease in the second half of 2022.”
Stocks on Wall Street were lower. The dollar slipped against a basket of currencies. U.S. Treasury yields dipped.
The reports added to a surge in retail sales in October and a sharp rebound in production at factories in suggesting that economic activity accelerated early in the fourth quarter after gross domestic product increased at its slowest pace in more than a year in the July-September period.
Stronger growth could spill over into 2022, with a third report from the Conference Board showing its index of Leading Economic Indicators jumped 0.9% in October after gaining 0.1% in September.
Leading indicators: https://graphics.reuters.com/USA-STOCKS/byvrjknbbve/leadingindicators.png
The labor market is getting tighter. The number of people continuing to receive benefits after an initial week of aid dropped 129,000 to 2.080 million in the week ended Nov. 6, the claims report showed. That was also the lowest level since the mid-March in 2020.
A total 3.185 million people were collecting unemployment checks under all programs during the week ended Oct. 30. Shrinking unemployment rolls raise hopes that more people will return to the labor force soon.
Millions of unemployed Americans remain at home even after the expiration of generous federal government-funded benefits, the reopening of schools for in-person learning and companies raising wages.
The claims data covered the period during which the government surveyed business establishments for the nonfarm payrolls component of November’s employment report.
Claims have dropped since mid-October, which would suggest stronger employment growth this month. But workers are scarce, with 10.4 million job openings as of the end of September.
“There is some uncertainty as a key to monthly job growth is labor supply and the Delta variant,” said Ryan Sweet, a senior economist at Moody’s Analytics in West Chester, Pennsylvania. “The good news is that the Delta variant’s impact on the labor market in November will be less than that seen during the teeth of the recent wave.”
The economy created 531,000 jobs in October. Employment growth has averaged 582,000 jobs per month this year and the labor force is down 3 million from its pre-pandemic level.
(Reporting by Lucia Mutikani; Editing by Andrea Ricci)
OTTAWA – Statistics Canada says wholesale sales, excluding petroleum, petroleum products, and other hydrocarbons and excluding oilseed and grain, rose 0.4 per cent to $82.7 billion in July.
The increase came as sales in the miscellaneous subsector gained three per cent to reach $10.5 billion in July, helped by strength in the agriculture supplies industry group, which rose 9.2 per cent.
The food, beverage and tobacco subsector added 1.7 per cent to total $15 billion in July.
The personal and household goods subsector fell 2.5 per cent to $12.1 billion.
In volume terms, overall wholesale sales rose 0.5 per cent in July.
Statistics Canada started including oilseed and grain as well as the petroleum and petroleum products subsector as part of wholesale trade last year, but is excluding the data from monthly analysis until there is enough historical data.
This report by The Canadian Press was first published Sept. 13, 2024.
VICTORIA – British Columbia is forecasting a record budget deficit and a rising debt of almost $129 billion less than two weeks before the start of a provincial election campaign where economic stability and future progress are expected to be major issues.
Finance Minister Katrine Conroy, who has announced her retirement and will not seek re-election in the Oct. 19 vote, said Tuesday her final budget update as minister predicts a deficit of $8.9 billion, up $1.1 billion from a forecast she made earlier this year.
Conroy said she acknowledges “challenges” facing B.C., including three consecutive deficit budgets, but expected improved economic growth where the province will start to “turn a corner.”
The $8.9 billion deficit forecast for 2024-2025 is followed by annual deficit projections of $6.7 billion and $6.1 billion in 2026-2027, Conroy said at a news conference outlining the government’s first quarterly financial update.
Conroy said lower corporate income tax and natural resource revenues and the increased cost of fighting wildfires have had some of the largest impacts on the budget.
“I want to acknowledge the economic uncertainties,” she said. “While global inflation is showing signs of easing and we’ve seen cuts to the Bank of Canada interest rates, we know that the challenges are not over.”
Conroy said wildfire response costs are expected to total $886 million this year, more than $650 million higher than originally forecast.
Corporate income tax revenue is forecast to be $638 million lower as a result of federal government updates and natural resource revenues are down $299 million due to lower prices for natural gas, lumber and electricity, she said.
Debt-servicing costs are also forecast to be $344 million higher due to the larger debt balance, the current interest rate and accelerated borrowing to ensure services and capital projects are maintained through the province’s election period, said Conroy.
B.C.’s economic growth is expected to strengthen over the next three years, but the timing of a return to a balanced budget will fall to another minister, said Conroy, who was addressing what likely would be her last news conference as Minister of Finance.
The election is expected to be called on Sept. 21, with the vote set for Oct. 19.
“While we are a strong province, people are facing challenges,” she said. “We have never shied away from taking those challenges head on, because we want to keep British Columbians secure and help them build good lives now and for the long term. With the investments we’re making and the actions we’re taking to support people and build a stronger economy, we’ve started to turn a corner.”
Premier David Eby said before the fiscal forecast was released Tuesday that the New Democrat government remains committed to providing services and supports for people in British Columbia and cuts are not on his agenda.
Eby said people have been hurt by high interest costs and the province is facing budget pressures connected to low resource prices, high wildfire costs and struggling global economies.
The premier said that now is not the time to reduce supports and services for people.
Last month’s year-end report for the 2023-2024 budget saw the province post a budget deficit of $5.035 billion, down from the previous forecast of $5.9 billion.
Eby said he expects government financial priorities to become a major issue during the upcoming election, with the NDP pledging to continue to fund services and the B.C. Conservatives looking to make cuts.
This report by The Canadian Press was first published Sept. 10, 2024.
Note to readers: This is a corrected story. A previous version said the debt would be going up to more than $129 billion. In fact, it will be almost $129 billion.
NANAIMO, B.C. – Former Bank of Canada governor Mark Carney says he’ll be advising the Liberal party to flip some the challenges posed by an increasingly divided and dangerous world into an economic opportunity for Canada.
But he won’t say what his specific advice will be on economic issues that are politically divisive in Canada, like the carbon tax.
He presented his vision for the Liberals’ economic policy at the party’s caucus retreat in Nanaimo, B.C. today, after he agreed to help the party prepare for the next election as chair of a Liberal task force on economic growth.
Carney has been touted as a possible leadership contender to replace Justin Trudeau, who has said he has tried to coax Carney into politics for years.
Carney says if the prime minister asks him to do something he will do it to the best of his ability, but won’t elaborate on whether the new adviser role could lead to him adding his name to a ballot in the next election.
Finance Minister Chrystia Freeland says she has been taking advice from Carney for years, and that his new position won’t infringe on her role.
This report by The Canadian Press was first published Sept. 10, 2024.
