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New unemployment claims jump to nearly 1 million

WASHINGTON — The number of new unemployment claims filed jumped by 181,000 to 965,000 last week, the largest increase since the beginning of the pandemic.

It was the highest number of new unemployment claims since August.

An additional 284,000 claims were filed for the Pandemic Unemployment Assistance, the insurance for gig and self-employed workers.

In Massachusetts, more than 31,000 individuals filed initial claims for unemployment benefits, up roughly 5,200 from the week prior. Many individuals have run out of regular benefits and moved on to other programs. About 28,400 people filed claims under the Extended Benefits program, an increase of about 11,500 from the week prior. The program provides benefits to those who exhausted another extended benefits program, called Pandemic Emergency Unemployment Compensation.

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The weekly report is President Trump’s last before President-elect Joe Biden is sworn in on Jan. 20. Biden will inherit a labor market badly weakened by the coronavirus pandemic and an economic recovery that appears to have stalled: 140,000 people lost their jobs in December, the first decline in months, with the United States still down millions of jobs since February.

Democrats were already using the weak labor report to argue for the necessity of more aid.

John Leer, an economist at Morning Consult, said the increase could be explained in part by two other factors: states working through backlogs that built up over the holidays and more incentives and ability for workers who had not filed claims or whose claims had lapsed to file claims. As the aid package that Congress passed in December kicks in, workers are now eligible for a $300 a week unemployment supplement on top of whatever payment they are receiving from the state.

’'There are a lot of people who it isn’t worth their effort to go through filing claims for $100 a week, but all of a sudden at $400 a week, it becomes worth their while,’' Leer said. ’'There are so many confounding factors that it’s dangerous to read too much into one week’s numbers.’'

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Morning Consult’s polling data on unemployment, he said, had showed last week to be better than the week before it.

Economists say the struggles can be explained, in part, by the delay Congress allowed between the summer, when many fiscal aid programs expired, and December, when lawmakers agreed on a new package after months of stalemate.

The number of new jobless claims has come down since the earliest days of the pandemic, but remains at a extremely high level week in and week out.

These claims have been higher for more than 40 weeks than those in the Great Recession.

The total number of continuing people in any of the unemployment programs at the end of the year was 18.4 million, although officials have cautioned that the number is inflated by accounting issues and duplicate claims.