WASHINGTON -- The number of Americans seeking unemployment benefits increased last week to 332,000 from a pandemic low, a sign that the spread of the delta variant may have slightly increased layoffs.
Applications for jobless aid rose from 312,000 the week before, the Labor Department said Thursday. That was the lowest level since March 2020. New jobless claims, which generally track the pace of layoffs, have fallen steadily for two months as many employers, struggling to fill jobs, have held on to their workers.
Continuing claims for state benefits fell to 2.7 million in the week ending Sept. 4, a fresh pandemic low.
Last week's increase in new claims was small and may be temporary. The four-week average of jobless claims, which smooths out fluctuations in the weekly data, dropped for the fifth straight week to just below 336,000. That figure is also the lowest since the pandemic began.
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Separately, the Commerce Department reported that retail sales unexpectedly rose 0.7% last month, as Americans kept spending despite the rise in coronavirus cases. But how they spent continues to be skewed by the pandemic. Online shopping jumped in August but spending at restaurants, bars and other businesses that rely on crowds, appears to have gone into a holding pattern.
Unemployment aid applications jumped 4,000 in Louisiana, evidence that Hurricane Ida led to widespread job losses in that state. Ida will likely nick the economy's growth in the current July-September quarter, though repairs and rebuilding efforts are expected to make up for some of that in the coming months.
Still, Ida shut down oil refineries in Louisiana and Mississippi about two weeks ago, and left more than 1 million homes and businesses without electricity. But Ida's impact was limited: Applications for jobless aid fell slightly in Mississippi.
Arizona and Washington, D.C., posted large increases, while claims in Illinois, Ohio and Texas were among the biggest drops.
The job market and the broader economy have been slowed in recent weeks by the delta variant, which has discouraged many Americans from traveling, staying in hotels and eating out. Earlier this month, the government reported that employers added just 235,000 jobs in August after having added roughly a million people in both June and July.
Hiring in August plummeted in industries that require face-to-face contact with the public, notably restaurants, hotels and retailers. Still, some jobs were added in other areas, and the unemployment rate dropped to 5.2% from 5.4%.
The steady fall in weekly applications for unemployment benefits coincides with a scaling-back of aid for jobless Americans. Last week, more than 8 million people lost all of their unemployment benefits with the expiration of two federal programs that covered gig workers and people who have been jobless for more than six months. Those emergency programs were created in March 2020, when the pandemic first tore through the economy.
An additional 2.7 million people who are receiving regular state unemployment aid lost a $300-a-week federal unemployment supplement last week.
Information for this article was contributed by Jill R. Shah of Bloomberg News (WPNS).