New applications for US unemployment benefits fell more than expected last week as President Joe Biden took office, but remain distressingly high months after the Covid-19 pandemic began, according to government data released Thursday.

The Labor Department reported 847,000 new claims for jobless benefits filed in the week ended January 23, seasonally adjusted, slightly less than analysts expected, and a decline from the 914,000 filings in the previous week.

Another 426,856 claims, without seasonal adjustment, were reported under a program passed during the pandemic to aid workers not normally eligible for benefits, according to the report.

The data also showed a jump in the number of people receiving benefits for the long-term unemployed.

New benefit claims have fluctuated in recent weeks and it remains to be seen if this report will mark a sustained decline, but 10 months into the pandemic, new applications each week have yet to drop below the worst single week seen in the 2008-2010 global financial crisis.

"Additional fiscal stimulus and broader vaccine diffusion should support an improved labor market in the spring, but claims are expected to remain high in the near term as the pandemic continues to restrict activity, with new strains of the virus a concern," Nancy Vanden Houten of Oxford Economics said.

More than 10 months after the Covid-19 pandemic caused mass layoffs in the United States, the economy is far from healed More than 10 months after the Covid-19 pandemic caused mass layoffs in the United States, the economy is far from healed Photo: GETTY IMAGES NORTH AMERICA / SPENCER PLATT

After enacting trillions of dollars of stimulus as the pandemic arrived last March, Congress near the close of 2020 passed another $900 billion measure that refreshed pandemic unemployment programs and offered more support to small businesses.

Biden has proposed a $1.9 trillion measure to further aid the economy's recovery, through its prospects in Congress, which is narrowly controlled by his Democratic party, is unclear.

The data makes clear the grievous toll the virus has taken on the American job market, with nearly 18.3 million people receiving some form of aid as of the week ended January 9, the latest for which data was available.

The number of people claiming aid under Extended Benefits, which is usually the last program available to people who have been unemployed for a long time, rose to more than 1.5 million that same week.

Vanden Houten warned that augured poorly for overall employment, since that program was not available in all states.