Weekly jobless claims total 238,000, fewer than expected

Initial filings for unemployment claims totaled a bit fewer than expected last week as companies looked to overcome the impact of the omicron spread.

Claims for the week ended Jan. 29 were 238,000, a touch lower than the 245,000 Dow Jones estimate, the Labor Department reported Thursday. That was also a decline from the previous week’s upwardly revised 261,000.

The report closes out a tough January in which millions of Americans lost work due to the Covid impact.

Census Bureau data shows that more than 8.7 million workers missed time in late January into February due either to having Covid themselves or having to care for someone with the virus. Nearly 2 million more said they were out of work due to their employer closing for Covid-related reasons, while almost 1.5 million more said they lost jobs because their employer shut down permanently due to the pandemic.

Claims have turned higher after briefly dipping below 200,000 in early December and posting their lowest total in more than 50 years.

With cases declining sharply over the past two weeks, economists are optimistic that the trend will reverse itself.

Continuing claims, which run a week behind the headline number, showed a substantial decrease, falling 44,000 to 1.63 million. The four-week moving average for claims, which helps adjust for weekly volatility, slipped to 1.62 million, the lowest total since Aug. 4, 1973.

The total of those receiving benefits under all programs declined to 2.07 million, a drop of 73,205, according to data through Jan. 15. That compares with 18.5 million from a year ago and has fallen substantially as extended benefits have expired for the unemployed.

The numbers came the day before the Bureau of Labor Statistics releases its closely watched January nonfarm payrolls report, which is expected to show a gain of 150,000 though some economists think the U.S. actually may have lost jobs for the period.

In other economic news Thursday, productivity surged 6.6% in the fourth quarter of 2021, well above the estimate of 4.4%, according to preliminary figures from the BLS. At the same time, unit labor costs rose just 0.3%, well below the 1% estimate.

Unit labor costs are measured as the difference between hourly compensation, which rose 6.9%, and productivity. The smaller-than-expected gain provides a sign that productivity is helping offset inflation running at its fastest pace in nearly 40 years.

Correction: Jobless claims for the previous week were upwardly revised to 261,000. An earlier version misstated the figure.