US initial jobless claims fell more than last week’s forecast

Labor Department data showed Thursday that initial unemployment claims in routine state programs dropped to 310,000 in the week ending September 4. The average estimate in a Bloomberg survey of economists called for a modest reduction in 335,000 new applications.

Continuing claims for state benefits fell to 2.78 million for the week ending August 28.

Initial claims have declined steadily as vaccination progress and reopening has increased demand for workers. Still, claims are higher than pre-pandemic levels, and economists expect economic growth to slow in the third quarter as stimulus spending moderates.

The recent surge in COVID-19 infections appears to hinder a steady recovery in the labor market, especially if the outbreak prompts school districts to rethink individual schooling.