US unemployment claims fall to 779,000 but job cuts grind on

WASHINGTON (AP) — The number of Americans seeking unemployment benefits declined to 779,000 last week, a still-historically high total that shows that a sizable number of people keep losing jobs to the viral pandemic.

Last week’s total dropped from 812,000 the previous week, the Labor Department said Thursday, and is the lowest in two months. Still, before the virus erupted in the United States in March, weekly applications for jobless aid had never topped 700,000, even during the Great Recession.

Thursday's report reflects a U.S. job market that is still suffering from the pandemic, with hiring having weakened for six straight months. It is a key reason why President Joe Biden is pushing Congress to enact a $1.9 trillion economic rescue program, on top of a $900 billion federal aid package that was approved late last year.

All told, 17.8 million people were receiving unemployment benefits in the week that ended Jan. 16, the latest period for which data are available. That’s down from 18.3 million from the week before.

Despite the generally dim picture of the economy, some hopeful signs have emerged this week. Auto sales rose solidly in January, and a gauge of business growth in the service sector picked up. So did spending on home construction.

That doesn’t mean a rebound is near in the job market, which typically lags behind recoveries in the broader economy. Employers have been hesitant to hire at a time when consumer spending has faltered.

The government’s jobs report for January, to be released Friday, is expected to show a modest hiring gain of perhaps 100,000, according to data provider FactSet. The unemployment rate is forecast to remain stuck at a high 6.7% for a third straight month.

An increase in hiring would represent a welcome improvement over...