WASHINGTON (Reuters) – The number of Americans seeking unemployment benefits dropped below one million last week for the first time since the start of the COVID-19 pandemic in the United States, likely as the expiration of a $600 weekly jobless supplement discouraged some from filing claims.

Initial claims for state unemployment benefits totaled a seasonally adjusted 963,000 for the week ended Aug. 8, compared to 1.191 million in the prior week, the Labor Department said on Thursday. That was the lowest level since mid-March when authorities started shutting down non-essential business to slow the spread of coronavirus. Economists polled by Reuters had forecast 1.12 million applications in the latest week.

The extra unemployment benefit lapsed on July 31. President Donald Trump on Saturday signed an executive order, including extending the supplement, though he reduced the weekly payout to $400. But there has been confusion over the order.

States are required to cover $100 of the benefits, but governors have indicated they don’t have the financial capacity after revenues were decimated in the fight against the COVOD-19 pandemic. The remaining $300 will be funded from a limited emergency disaster relief program, which economists estimated could be depleted as early as September.

White House Economic Adviser Larry Kudlow said on Thursday Trump’s plan would provide an extra $300 per week. Industry groups and Republicans claimed that the $600 weekly supplement was encouraging some unemployed people to stay at home.

Many economists rejected the argument and credited the supplement for the economy’s nascent recovery from a recession triggered by the coronavirus. A government-funded program offering businesses loans to help with wages has also lapsed.

New COVID-19 infections are spreading across the nation, forcing authorities in some of the hot spots to either shut down businesses again or pause reopenings.

Data from Homebase, a payroll scheduling and tracking company, showed a decline in employment last week. Figures from Kronos, a workforce management software company, showed a flattening in the number of shifts worked.

Claims peaked at a record 6.867 million in late March.

Thursday’s claims report also showed the number of people receiving benefits after an initial week of aid totaled 15.486 million in the week ending August 1, compared with 16.09 million in the prior week.

The government reported last week that the economy created

1.763 million jobs in July after adding a record 4.791 million in June. It has regained only 9.3 million of 22 million jobs lost between February and April.

Reporting By Lucia Mutikani; Editing by Chizu Nomiyama

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