Weekly jobless claims better than expected in another sign of healing for employment

The U.S. unemployment picture improved again last week, with initial filings for unemployment insurance falling to another pandemic-era low.

First-time claims dropped to 269,000 for the week ended Oct. 30, down 14,000 from the previous period and better than the Dow Jones estimate for 275,000, the Labor Department reported Thursday.

The decline in filings comes amid a rollback in special programs initiated during the crisis, with the total of those receiving benefits under all programs dropping another 157,731 to 2.67 million.

As the jobs picture clears up, the four-week moving average for claims, which helps smooth weekly volatility, fell 15,000 to 284,750. A year ago, the average was 791,000, and it was 225,500 in March 2020 just before the pandemic declaration sent more than 20 million Americans to the unemployment line.

Continuing claims, which run a week behind the headline number, declined 134,000 to just over 2.1 million.

All of the jobless totals are the lowest since March 14, 2020.

“The fifth straight weekly drop in jobless claims, to a new pandemic low, is consistent with all the other evidence pointing to labor market tightness,” wrote Ian Shepherdson, chief economist at Pantheon Macroeconomics. “With demand reviving post-Delta, the bar for layoffs is high and rising. Claims appear to be on course to reach the pre-Covid level early next year.”

The claims report comes a day before the Labor Department’s closely watched nonfarm payrolls count, which is expected to show growth of 450,000 for October.

Though the most recent claims report falls outside the survey week the government uses for its official count, the declining total represents a jobs market healing from the pandemic abyss but also facing a series of unique obstacles.

American businesses have been hit with a chronic labor shortage that has caused a number of ills, including shorter hours, less product on shelves and escalating inflation. Responding in part to the rising price pressures, the Federal Reserve on Wednesday said it would begin reducing the amount of support it is providing for the economy by slowly tapering its monthly bond purchases.