The past continuous is used:
- to describe conditions or an environment in the past:
The sun was shining and a few whitecaps were breaking on the rocks a distance toward the open sea.
- to establish a temporal frame for another action/state that takes place within this frame or interrupts it. This second action/state is usually expressed in past simple:
I was just eating lunch when the telephone rang.
- To narrate what one was doing at a particular time:
I was weeding the garden all morning.
- to highlight an activity of some duration in the past rather than simply a completed action in the past:
Back then he was painting a lot of landscapes. Accent on activity
Back then he painted a lot of landscapes. Past action
Perhaps you were thinking of this use of the past continuous, since the verb required in the blank doesn't set the scene or provide a temporal frame for another action. If the verbs were to highlight the repeated activity, however, the author of the passage would most likely have cast both verbs in the second sentence in the past continuous and kept they, the workers, as the subject:
They were looking through the newspapers every day but not finding many job openings.
This would make narrative sense if the passage goes on to discuss the workers. But since the second verb is past simple and the focus not on the workers failure to find job openings but on the lack of them in the newspapers, one suspects that the entire passage is cast in the past simple to narrate past actions:
That left a lot of machine workers without a job in one small town. They looked through the newspapers every day, but there weren't many job vacancies.