US weekly jobless claims fall for the first time in a month

WASHINGTON (AP) — Fewer Americans applied for unemployment benefits last week following three straight increases amid a surge in cases of the omicron variant of COVID-19.

Jobless claims fell by 30,000 to 260,000 last week, the Labor Department reported Thursday, fewer than the 265,000 analysts were expecting.

The four-week average of claims, which compensates for weekly volatility, rose by 15,000 to 247,000, the highest in two months.

Altogether, nearly 1.7 million people were collecting jobless aid the week that ended Jan. 15, a nominal increase of 51,000 from the previous week.

A recent surge in COVID-19 cases has set back what had been a strong comeback from last year’s short but devastating coronavirus recession. Jobless claims, a proxy for layoffs, had fallen mostly steadily for about a year and late last year dipped below the pre-pandemic average of around 220,000 a week. Economists expect claims to return to those lower levels as the virus fades, which is already taking place in regions that were hit first with omicron infections.

After a spike in cases across the East Coast at the end of 2021, the seven-day rolling average for daily new COVID-19 cases in the U.S. has fallen by about 25% since January 12, according to data from Johns Hopkins University. However, the seven-day rolling average for COVID-19 deaths has risen significantly, from just less than 1,800 per day to about 2,300 per day during the past two weeks.

The job market has bounced back from last year’s brief but intense coronavirus recession, and companies are desperate to retain and hire workers, despite the recent uptick in jobless claims. The unemployment rate settled at 3.9% last month, a long steady decline from heights of nearly 15% in the spring of 2020 when the pandemic devastated the...