The Labor Department has released their latest report concerning the number of applications submitted for unemployment benefits, which shows the number went up by 37,000 over the course of the last week, hitting 412,00.
The new number was significantly higher than the 359,000 that forecasters had predicted.
Weekly jobless claims are being watched closely as the U.S. economy recovers because recent monthly jobs reports have been less than stellar and have added to concerns that the country could be in the throes of a labor shortage.
The economy fell slightly short of expectations last month and added 559,000 new jobs, a number that was below the 650,000-consensus level but was still far more positive than the surprisingly bad report from the month before. Only 278,000 jobs were added in April, a figure way below predictions of nearly 1 million additional jobs.
This week’s jobless claims report is also notable because it is the first after some states have begun opting out of the federal government’s $300-per-week expanded unemployment insurance program, which critics assert has been holding back the labor force by incentivizing collection of the increased benefits.
Alaska, Iowa, Mississippi, and Missouri, which together have a combined population of close to 13 million, were the first states in the country to end the benefits program last week. Half of the states in the country will be working toward shutting down the program in the coming weeks before the official sunset date set for September 6.
This program is causing a massive shortage of labor for businesses across America, as people are making more money by not working, which takes away the incentive for people to get jobs.
If we want to see the economy rebound, we have to end this benefits program.