Job figures: 1.2 million still claiming unemployment benefits as US economy struggles to bounce back

Figures come as congressional leaders continue talks over coronavirus stimulus package

Some 1.2 million Americans are still claiming unemployment benefits, newly released figures show, in a sign that the US economy is struggling to bounce back amid the Covid-19 pandemic.

Data released by the Labor Department on Thursday revealed that there were 1.186 million benefits claims for the week ending 1 August, compared with 1.435 million in the previous week.

While the figures represent a slight improvement, the high number of people remaining out of work is likely to cause alarm for Donald Trump, with the US presidential election now just months away.

Trump’s campaign team has sought to position the president as the economically credible candidate after a promising start to his term in office. But the economy has taken a hammering since the pandemic struck in March.

The figures come as the US is experiencing a surge in new infections in a number of states across the country, particularly in the south and the west.

California, Florida and Texas have all seen large numbers of new Covid-19 cases and deaths in recent weeks, leading authorities to shut down businesses or pause re-openings.

Despite the spike in cases, Mr Trump has called for businesses to resume trading as he attempts to get the faltering economy back on track ahead of November’s poll.

The scale of the damage to the economy is perhaps underlined by the size of the coronavirus relief package US lawmakers have proposed to help stimulate growth.

Democrats have proposed a $3 trillion stimulus package while Republicans have put forward their own plans for $1 trillion to be injected into the economy.

Some of the money would be used to help fund schools and service unemployment benefits payments.

On Wednesday, House speaker Nancy Pelosi, and Senate minority leader Chuck Schumer, met with treasury secretary Steven Mnuchin, and White House chief of staff Mark Meadows, in an attempt to find a compromise.

Both sides have said they want to reach a deal by the end of the week, but progress has been slow.

“I think at this point, we’re either going to get serious about negotiating and get an agreement in principle,” Mr Meadows said following Wednesday’s meeting. “We’ve been spending so much time together that if you’re not making progress, there’s no sense to continue.”

Ms Pelosi told reporters she was “optimistic” about a deal but still unsure about the timing.

“I feel optimistic that there is a light at the end of the tunnel, but how long that tunnel is remains to be seen,” she said.

Any deal will come too late for the millions of Americans who were plunged into further financial difficulty on Friday when their $600 weekly enhanced unemployment benefit expired.