Weekly Jobless Claims Tick Upward, Exceed 400,000

New jobless claims rose this past week, surprising analysts and indicating that our economic recovery is far from complete.

For the week ended July 10, first-time jobless claims were reported as 360,000, which represented the lowest number of new weekly claims since the start of the pandemic. That figure has since been revised to 368,000, which is still a pandemic-era low.

But the numbers don't look as good for the week ended July 17. New jobless claims came in at 419,000, which is not only a huge jump from the previous week, but also well above the 350,000 new claims analysts were anticipating. In fact, this past week's claims count was the highest since mid-May, and it's a sobering reminder that our nation's economic recovery is far from complete.

Will the Delta variant make things worse?

There are fears among economists that the Delta variant could play a role in hindering the progress that's been made on the jobs front over the past couple of months. If states are forced to establish restrictions and businesses are limited in how they can operate, more jobs are apt to be shed.

All of this is coming at a time when roughly half of U.S. states have pulled the plug on boosted unemployment benefits ahead of schedule. The American Rescue Plan, which was signed in March, called for a $300 weekly boost to jobless benefits through Labor Day, but that extra money is already off the table for a lot of people who are out of work.

Now on a more positive note, continuing jobless claims were reported as 3.24 million, which actually represents a decline of 126,000 from the previous week's number. It also represents a pandemic low.

Will rising jobless claims lead to another stimulus check?

At this point, many people have already spent the money they received from their last stimulus check, and the big question is whether more aid will arrive later on in the year or at another point in the future. Right now, it's too soon to tell. While it is a bit unsettling to see weekly jobless claims jump upward substantially, a one-week step backward is unlikely to serve on its own as justification for a fourth stimulus round.

That said, if the recent outbreak fueled by the Delta variant gets worse and businesses are forced to shutter or change the way they operate once again, then that could make the case for more aid, especially if those rules have to remain in place for quite some time. Americans shouldn't expect another round of stimulus checks to hit their bank accounts. But to say that another round absolutely isn't happening would be premature.

Similarly, boosted unemployment benefits are set to expire in early September. If weekly jobless claims continue to increase, lawmakers may have to contemplate an extension. The same will hold true if the Delta variant fuels outbreaks in schools and forces districts to close for in-person learning again. Though the country is largely planning for full-time, in-person school, the one thing the pandemic has taught us is to gear up for things to change on a whim.