A few comments:
In normal times, most analysts focus on initial unemployment claims for the BLS reference week of the employment report. For August, the BLS reference week is August 9th through the 15th, and the initial claims report this morning was for the reference week. The increase in initial claims in the report this morning would usually indicate weakness in the labor market.
However, continued claims are probably much more useful now. Continued claims are released with a one week lag, so continued claims for the reference week will be released next week. Continued claims are down 2.1 million from the reference week in July, suggesting an increase in employment in August.
There are an additional 11,224,774 receiving Pandemic Unemployment Assistance (PUA). This is a special program for business owners, self-employed, independent contractors or gig workers not receiving other unemployment insurance.
The following graph shows regular initial unemployment claims (blue) and PUA claims (red) since early February.
This was the 22nd consecutive week with extraordinarily high initial claims.
We are probably seeing some layoffs related to the higher level of COVID cases and also from the end of some Payroll Protection Programs (PPP).