U.S. weekly jobless claims fall to 17-month low

The number of Americans filing new claims for unemployment benefits fell to a 17-month low last week, pointing to another month of robust job growth, though surging COVID-19 infections pose a risk to the labor market recovery.

The weekly unemployment claims report from the Labor Department on Thursday, the most timely data on the economy's health, also showed the number of people on state jobless rolls dropped in early August to levels last seen in mid-March 2020, when the economy almost ground to a halt amid mandatory business closures aimed at slowing the first wave of COVID-19 cases.

"A healthy drop in unemployment claims is the latest evidence the rise of the Delta variant isn't having a significant effect on the economy," said Robert Frick, corporate economist at Navy Federal Credit Union in Vienna, Virginia. "We can infer that hiring remains strong in August, pointing to a healthy jobs report for this month."

Initial claims for state unemployment benefits fell 29,000 to a seasonally adjusted 348,000 for the week ended Aug. 14. The fourth straight weekly decline pushed claims to their lowest level since mid-March 2020.

Data for the prior week was revised to show 2,000 more application received than previously reported. Economists polled by Reuters had forecast 363,000 applications for the latest week. The four-week moving average of initial claims, considered a better measure of labor market trends as it irons out week-to-week volatility dropped 19,000 to 377,750, also a 17-month low.

Last week's decrease in filings was led by Texas. There were also notable declines in Illinois, Kentucky and Michigan.

Claims have declined from a record 6.149 million in early April 2020, but they remain above the 200,000-250,000 range that is seen as consistent with healthy labor market conditions.