The state of employment in the U.S. took centerstage Thursday when the U.S. Labor Department released its weekly jobless claims report.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="An additional 1.877 million Americans filed for unemployment benefits in the week ending May 30, exceeding economists’ estimates for 1.843 million initial jobless claims during the week. The prior week’s figure was revised higher to 2.13 million from the previously reported 2.12 million. Over the past 11 weeks, more than 42 million Americans have filed for unemployment insurance.” data-reactid=”17″>An additional 1.877 million Americans filed for unemployment benefits in the week ending May 30, exceeding economists’ estimates for 1.843 million initial jobless claims during the week. The prior week’s figure was revised higher to 2.13 million from the previously reported 2.12 million. Over the past 11 weeks, more than 42 million Americans have filed for unemployment insurance.

After seeing a decline in the previous week’s report, continuing claims, which lags initial jobless claims data by one week, increased to 21.49 million in the week ending May 23, up from 20.84 million in the previous week. Consensus expectations were for 20 million continuing claims.

“The rise in continuing jobless claims is worrisome because it means people remained unemployed and didn’t return to work,” Mark Tepper, president and CEO of Strategic Wealth Partners, said in an e-mail Thursday.

Pandemic Unemployment Assistance (PUA) program claims, which include those who were previously ineligible for unemployment insurance such as self-employed and contracted workers, fell significantly to 623,073 in the week ending May 30 from the prior week’s 1.3 million.

In the week ending May 30, California reported the highest number of jobless claims at an estimated 230,000 on an unadjusted basis, up from 203,000 in the previous week. Florida had 206,000, up from 175,000. Georgia reported 148,000 and Texas had roughly 107,000 jobless claims.

Economists believe that last week’s jobless claims report might have signaled a turning point for unemployment in the U.S.

“[Last] week’s jobless claims data contains more good news than bad. Continuing claims for the week ending May 16 fell by 3.9mn, to 21.052mn, leading to a drop in the insured unemployment rate to 14.5%, from 17.1% previously,” Barclays outlined in a note to clients May 29. “This likely signals that the hiring rate accelerated and is broadly consistent with our outlook for a near-term peak in the unemployment rate in May, followed by declines thereafter.”

The weekly initial jobless claims report comes on the heels of the ADP private employment report and ahead of the highly-anticipated May jobs report, which is set to be released Friday morning.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="ADP’s report showed that the U.S. economy lost 2.76 million private payrolls in May, which was significantly fewer than estimates for 9 million job losses during the month.” data-reactid=”25″>ADP’s report showed that the U.S. economy lost 2.76 million private payrolls in May, which was significantly fewer than estimates for 9 million job losses during the month.

“The ADP report isn’t always a reliable predictor of the BLS data, but it suggests that the pace of job loss moderated noticeably between April and May, even though it remained substantial relative to pre-COVID-19 norms. This is a message broadly consistent with some other related signals, and the labor market likely has benefitted from the easing of restrictions on activity in many places in recent weeks,” JPMorgan said in a note Wednesday.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Read more: US economy shed 2.76 million private payrolls in May: ADP” data-reactid=”27″>Read more: US economy shed 2.76 million private payrolls in May: ADP

MILFORD, PENNSYLVANIA, UNITED STATES - 2020/05/15: A man holds a placard saying, Flatten the Curve of Unemployment, during the demonstration. Pike County Pennsylvania and Milford, Pennsylvania area residents protest against Governor Wolf and the ongoing business closures. (Photo by Preston Ehrler/SOPA Images/LightRocket via Getty Images)MILFORD, PENNSYLVANIA, UNITED STATES - 2020/05/15: A man holds a placard saying, Flatten the Curve of Unemployment, during the demonstration. Pike County Pennsylvania and Milford, Pennsylvania area residents protest against Governor Wolf and the ongoing business closures. (Photo by Preston Ehrler/SOPA Images/LightRocket via Getty Images)
A man holds a placard saying, Flatten the Curve of Unemployment, during the demonstration. (Photo by Preston Ehrler/SOPA Images/LightRocket via Getty Images)

Economists anticipate another historic decline in employment in May with the pace of layoffs significantly outpacing rehiring. The U.S. economy is estimated to have lost 8 million nonfarm payrolls, down from 20.54 million job losses in the prior month. The unemployment rate likely skyrocketed to nearly 20% during the month, up from 14.7% in April.

“In reality, the shadow unemployment rate, which includes people absent from work for other reasons, is much higher,” Morgan Stanley wrote in a note Wednesday. “There is considerable uncertainty as to how high the shadow unemployment rate could be due to compositional and categorization noise. For example, some people that were absent from work for other reasons are counted as employed, but are presumed to be unemployed. The Bureau of Labor Statistics could re-categorize this at any time, which could life the unemployment rate to as high as 25%, in our view.”

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="As of Thursday morning, there were 6.53 million coronavirus cases and 386,000 deaths worldwide, according to&nbsp;Johns Hopkins University data. In the U.S., there were 1.85 million cases and 107,000 deaths.” data-reactid=”41″>As of Thursday morning, there were 6.53 million coronavirus cases and 386,000 deaths worldwide, according to Johns Hopkins University data. In the U.S., there were 1.85 million cases and 107,000 deaths.

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<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Heidi Chung is a reporter at Yahoo Finance. Follow her on Twitter:&nbsp;@heidi_chung.” data-reactid=”43″>Heidi Chung is a reporter at Yahoo Finance. Follow her on Twitter: @heidi_chung.

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