In the United States, fewer people applied for unemployment benefits last week than at any other period since 1969.
According to the Labor Department, only 187,000 people filed for jobless benefits. This was a decrease of approximately 28,000 from the previous week.
The results demonstrate a dramatic improvement in the job market in the United States since the commencement of the coronavirus outbreak.
On social media, the news sparked multiple historical similarities, with some users uploading photographs from the Woodstock music festival.
“The last time jobless claims fell this low was the same year we landed folks on the moon,” said Rep Ted Lieu, Democrat from California.
“The last time weekly jobless claims were this low The Beatles were still together,” added Rep Don Beyer, Democrat of Virginia.
The current state of the US economy has many people looking to the past, but economists and experts have struggled to find the correct historical parallels.
When the lockdowns began two years ago, the weekly unemployment report reached all-time highs, with claims finally exceeding six million.
However, the economy has subsequently rebounded back with a strength that has astonished most economists, thanks to a major government stimulus programme.
Last year, growth increased by 5.7 per cent, while payrolls have been growing at a robust clip, increasing by more than 600,000 last month, helping to reduce the unemployment rate to 3.8 per cent.
Analysts said Thursday’s report highlighted the labour market’s tightness.
President Joe Biden has sought to take credit for the advances, citing Democratic spending plans and success in combating the coronavirus under his leadership.
He hailed Thursday’s data as yet another indicator of a “historic economic revival.”
However, polls reveal that the population is still concerned about the economy, as prices are rising at a rate not seen in 40 years.
Many in business are tormented by similarities to the 1970s, when the United States had so-called stagflation, in which growth stagnated even as price hikes spiralled, fueled in part by oil shocks.
According to David Rosenberg, president of the Toronto-based economic research business Rosenberg Research, economic indicators such as low jobless claims show that America’s economy is on the verge of a recession, as it was at the end of 1969.
But that doesn’t mean the US economy will face issues similar to those saw in the 1970s, he adds.
Inflationary pressures caused by supply shocks from the pandemic and Russia’s invasion of Ukraine, he believes, will eventually subside.
And he expects efficiency increases to boost growth, citing corporations’ increased expenditures in areas like as automation since the pandemic.
“That is where the comparison to the 1970s really falls flat on its face,” he said. He thinks a better comparison is the temporary inflation seen after World War One.
According to Brad DeLong, an economics professor at the University of California, the United States should endeavour to avoid following that pattern.
To rein in price hikes, the US central bank doubled interest rates from 3.75 percent to 7 per cent at the time, a move that renowned economists have since deemed to be too late and too far, he said.
He prefers similarities to the late 1940s and early 1950s, when the economy was shifting in reaction to World War II, the Korean and Cold Wars.
“I could be wrong. Uncertainty is rife. Everyone right now is reaching into the past and seeking for their favourite past historical inflationary episode as an analogy,” he said.
“Maybe we will see something completely new.”
(Adapted from TheGuardian.com)