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Home prices and joblessness increase

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Casey Harper | The Center Square

(The Center Square) - Earlier this week, President Joe Biden touted the country’s economic growth since he took office, but the latest economic data show that progress may not be as sturdy as experts would like.

The Department of Labor released new unemployment data Thursday showing a major spike in new jobless claims, meaning more Americans are filing for unemployment for the first time even as concerns grow over the Delta variant of COVID. The jobless increase came as a surprise to many experts, who hoped the U.S would continue an overall downward trend as the economy recovers from the pandemic-related economic shutdowns.

Meanwhile, home prices increased at a rapid rate in the last year.

The National Association of Realtors said Thursday that the median existing-home sales price increased by 23.4% from June 2020 to June 2021, the second highest recorded since January 1999.

"At a broad level, home prices are in no danger of a decline due to tight inventory conditions, but I do expect prices to appreciate at a slower pace by the end of the year," said Lawrence Yun, NAR's chief economist. "Ideally, the costs for a home would rise roughly in line with income growth, which is likely to happen in 2022 as more listings and new construction become available."

Biden addressed concerns over the economy and the rise of inflation in a town hall with CNN Wednesday night.

“First of all, the good news is the economy is picking up significantly,” Biden said. "It’s rational, when you think about it. The cost of an automobile bill, it’s kind of back to what it was before the pandemic. We compare what the prices were for the last year in the pandemic, and they are up. They’re up because, in fact, there was not much to call for.”

The Department of Labor data showed 419,000 Americans filed first-time unemployment claims for the week ending July 17, an increase of 51,000 from the previous week. Claims are significantly lower than during the middle of pandemic shutdowns.

“The total number of continued weeks claimed for benefits in all programs for the week ending July 3 was 12,573,833, a decrease of 1,262,815 from the previous week,” the Department of Labor said. “There were 32,935,470 weekly claims filed for benefits in all programs in the comparable week in 2020.”

The troubling unemployment data comes amid continued debate over the efficacy of the $300 federal weekly unemployment payments passed by Congress that are in addition to state benefits. More than two dozen states have announced they will turn away the federal benefits, citing business owners who say they are unable to fill positions despite the elevated unemployment.

A Morning Consult poll from earlier this month found that 1.8 million unemployed Americans had turned down a job, saying “I receive enough money from unemployment insurance without having to work.” 

Meanwhile, some states, like New York and California, have seen unemployment remain higher than other states for months.

“Our unemployment rate remains a pathetic 7.7 percent as our government clings to a pandemic mentality," said Kevin Riley, a Republican Assemblyman running to replace California Gov. Gavin Newsom in September's recall election. "September 14 will be a new day for California."