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Data released on Thursday showed that initial jobless claims jumped to the highest level since September in the week ended December 12. An unexpected rise in initial jobless claims is another sign that the labour market’s recovery is backsliding, explained analysts at Wells Fargo. 

Key Quotes: 

“Renewed restrictions and individual efforts to stem the spread of COVID are bearing down on the labor market. Initial jobless claims rose to 885K the week ending December 12, the second consecutive increase and highest reading since early September.”

“The rise comes during the payroll survey week, and increases the odds of a negative print for December. Claims usually drop this week of the year, but NSA PUA filings rose 40K.”

“Signs of longer term unemployment are growing, with the ranks of PEUC beneficiaries climbing by 268K the week of Nov. 28 (most recent). In total, 20.6M individuals are receiving unemployment benefits while the jobs market weakens anew.”