Encouraging trends are pointing to a healing labor market. Unemployment claims fell below one million per week to 963,000, beating expectations by a wide margin. This is a meaningful improvement from the six million weekly claims from late March and early April. Even in the best of times new unemployment claims run 200,000 to 300,000 per week. Equally important, the number of people collecting unemployment benefits is now 36% lower than it was at its peak level in May. This means more people are going back to work and layoffs are easing. In July, a net 1.7 million more people were back at work reducing the unemployment rate to 10.2%. This is still very high, but it is expected to continue declining as the economy reopens. Service industry jobs in retail, hospitality and healthcare are experiencing the biggest gains. Eyes are now set on Washington awaiting the next fiscal stimulus package to give the economy a boost. It is very likely that another $1 trillion to $2 trillion will be injected into the economy before the end of year, but the timing in unclear as the two parties struggle to find common ground.
