Retail sales rose in the United States in June but weekly data indicated a steady flow of layoffs, and with the coronavirus outbreak worsening, analysts fear further deterioration in the economy's health.

The US is home to the worst coronavirus pandemic anywhere, with a record 67,632 cases reported in the previous 24 hours on Wednesday, bedevilling states' efforts to get business back to normal.

The Labor Department on Thursday said new claims for unemployment benefits were at 1.3 million last week, higher than expected and barely changed from the week prior, meaning the surge in layoffs that began in mid-March as businesses closed has yet to subside.

Positive developments were seen in retail sales data released by the Commerce Department, and in a survey showing growth among manufacturers covered by the Philadelphia Federal Reserve Bank.

But economist fear the tentative economic recovery seen in recent weeks is set to be throttled by the renewed onslaught of COVID-19 cases, which is forcing states to roll back reopening measures.

"The reality is these numbers have remained elevated" Adam Ozimek, chief economist at freelancing platform Upwork, said on Twitter of the weekly claims data. "What this looks like is continued job loss and continued permanent business closures."

Up and down

The Labor Department said an additional 928,488 people in 47 states also made initial claims for benefits under a special program for workers affected by the pandemic who wouldn't normally be eligible for aid. 

However, in the week ended July 4, the insured unemployment rate dropped 0.3 points to 11.9% with 17,338,000 people receiving benefits - further evidence that at least some of those who lost their jobs as the pandemic arrived have returned to work.

The number of weekly initial claims remain well above any single week of the global financial crisis 12 years ago, and with this week's release bring the total number of layoffs since mid-March to 51.2 million.

"The trend in initial jobless claims has now just about stopped falling; next week could easily see an increase" due to the virus's resurgence particularly in the southern and western parts of the country, said Ian Shepherdson of Pantheon Macroeconomics.

"A flat trend in initial claims - which will in due course stop the downward trend in continuing claims - probably is about the best we can hope for."

Spend spend spend

Separately, the Commerce Department said retail sales were up 7.5% in June compared to May with $524 billion in business, a result better than economists forecast.

But the data reflects the period before the recent rollback in reopening measures, and was nonetheless below the 18.2% surge seen in May.

The pace of sales in the last three months of the COVID-19 crisis declined 8.1% below the same period of 2019.

Mickey Levy of Berenberg Capital Markets said retail sales had made a "v-shaped" recovery that put it just 0.6% below their level in February before the pandemic hit, which he credited to money doled out to Americans as part of the $2.2 trillion CARES Act rescue measure.

While accommodation, recreation and transportation spending will probably remain depressed, he saw the growth continuing, "Reflecting the continued rebound in healthcare services spending as elective and non-emergency procedures resume and strong pent-up demand for some personal care services."

The Federal Reserve Bank of Philadelphia said its manufacturing outlook survey had lowered three points to 24.1 in July but was still in expansion territory with activity, new orders and shipping growing for the second straight month.