Layoffs in the United States are still well above pre-pandemic levels, but at least they’re moving in the right direction.
Yet they are not falling fast enough to noticeably curb wealth and income inequality – both of which have expanded significantly as a result of the pandemic.
Two snapshots of the economy released on Thursday provided further evidence of this trend.
The number of Americans applying to states for unemployment benefits – one layoff agent – fell to 787,000 in the week ended October 17, the Department of Labor said Thursday.
That is 55,000 less than in the previous week. And much better than most analysts expected.
Unemployment claims have been revised to 767,000 for the week ending October 3. This is the lowest level since bans began to appear.
Falling unemployment claims are certainly better than rising ones. But last week’s number is still almost four times the average level for February.
Earlier this month, the number of people receiving unemployment benefits from state and federal programs exceeded 23 million. Though more than a million lower than the previous week, that’s incredibly high.
All of this underscores the challenging environment for Americans knocking on the sidewalk looking for work.
By the end of September, the economy had recovered just over half of the 22 million jobs lost in March and April. Many layoffs have resulted in permanent job losses and, as last week’s claims show, vacation days remain widespread.
It looks pretty good for Americans who have a job and want to own their own house or move or buy one.
The National Association of Realtors said Thursday that sales of previously owned homes rose for the fourth consecutive year in September. Completed transactions rose to 6.54 million units per year – the highest level in 14 years.
The report signals that the US housing market remains hot – even in a month when home sales traditionally slow down.
But the lowest mortgage rates and people who can afford to move to bigger and better digs keep the real estate market hot.
“I would attribute this jump to record-low interest rates and an abundance of buyers in the market, including vacation home buyers, because they have more flexibility to work from home,” said Lawrence Yun, chief economist for the National Association of Realtors.
The inequality that is deeper ingrained in the US economy couldn’t be stronger. Millions of Americans are struggling and looking for work while others look for vacation homes.
But even those at the end of this economic recovery could find themselves in difficult times as this very uneven recovery subsides.
Economists, including Federal Reserve Chairman Jerome Powell, have warned that the US economic recovery could be jeopardized without another round of virus aid to help businesses and workers still grappling with the financial fallout from the pandemic to have.
But the White House and Democrats in Congress couldn’t break their ongoing stalemate because of a new round of incentives.
And while Treasury Secretary Steven Mnuchin and Democratic leader, House Speaker Nancy Pelosi continue to speak, they are unlikely to reach an agreement in time for the November 3rd elections to approve a new package.
That said, whoever proves to be a winner when the ballots count will inherit an economy that leaves millions of Americans behind.