Claims for unemployment benefits in the United States jumped last week due to increases in New York and California, but remained historically weak, as demand for workers exceeded the number of people seeking employment. ‘a job.
Initial jobless claims, an indicator of layoffs, rose 21,000 to a seasonally adjusted 211,000 last week, the Labor Department said Thursday. This is the largest weekly increase in requests since early October.
The four-week average of weekly claims, which dampens volatility in weekly numbers, rose slightly to 197,000, an all-time low.
Weekly jobless claims have remained near or below the 2019 pre-pandemic average of around 220,000 for several months, despite job cuts at large employers in white-collar industries such as technology, finance and manufacturing. real estate. About 160 million Americans were employed in January.
“It’s definitely a very tight labor market and since many companies are having such a hard time finding workers, they are more likely to simply cut their hours than lay them off to cut labor costs,” said Giacomo Santangelo, economist at job site Monster.com.
Satellite radio company Sirius XM Holdings Inc. said in a letter to employees this week that it was reducing its workforce by 8%, or 475 positions, and General Motors Co. confirmed last week that it was reducing its workforce. employees.
These cuts have not translated into a slight increase in unemployment figures, as workers may quickly find new jobs or fail to apply for assistance due to generous severance packages.
There were 10.8 million job openings in January, the Labor Department said this week, and employers added more than half a million jobs that month while the unemployment rate fell to 3.4%, its lowest level since 1969.
Job postings in January fell from December’s 11.2 million, coinciding with some private sector data showing early signs of demand for American workers waning.
The Labor Department will release its February jobs report on Friday, offering a broad update on the state of the labor market.
The US economy showed momentum at the start of the year, which could prompt the Federal Reserve to accelerate interest rate hikes to fight inflation. Consumer spending surged and inflation firmed in January as US trade with the rest of the world increased. Business activity in the United States picked up in February.
Continuing claims, an indicator of the total number of outstanding unemployment benefit payments, rose 69,000, or 4.2%, to 1.72 million in the week ended February 25, the largest increase weekly since November 2021. Continuing requests are flagged with a one-week lag.
On an unadjusted basis, New York and California saw the largest increases in initial claims last week, accounting for more than three-quarters of the rise. Stephen Stanley, chief U.S. economist at Santander Corporate & Investment Banking, in an analyst note, attributed the shift in New York to a temporary increase in claims from New York school employees.
The level of insured unemployment is somewhat elevated from a low point of around 1.3 million last spring. Modestly high continuing claims could be a sign that some recipients are taking longer to find new employment.
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