Weekly Jobless Claims Are Down, but the Unemployment Situation Is Still Dire

Read the news on unemployment, and you'll see some pretty sobering statistics. The jobless rate has been astronomically high since March, when COVID-19 made itself known as a widespread U.S. threat. But this week, some better news emerged on unemployment: Weekly jobless claims finally came in at under 1 million for the first time since March. Specifically, there were only 963,000 new unemployment claims for the week ended Aug. 8, which represents a decline of 228,000 from the week prior.

Clearly, this is encouraging at a time when the U.S. economy is stuck in a recession and many states are having a hard time containing the COVID-19 outbreak. But to be clear, 963,000 is a lot of new jobless claims to be filed in the course of a single week, and given that boosted unemployment benefits have run out, those recently out of work could be in for some tough times.

In March, lawmakers passed the CARES Act, and one of its most important provisions was a $600 federal weekly boost to unemployment benefits. That allowed many workers to replace their missing paychecks in full as they rode out the recession and waited to be called back to work or offered new jobs.

Source Fool.com