The number of Americans filing new claims for unemployment benefits increased moderately in the past week, and that would indicate a downward trend. gradual relaxation of labor market conditions.
The Labor Department reported Thursday that initial claims for state unemployment benefits increased by 12,000, to a seasonally adjusted 248,000, in the week ending July 1. Above the 245,000 applications forecast by economists surveyed by Reuters for the last week.
In the first three weeks of June, applications reached their highest level in 20 monthsamid rising layoffs beyond the technology sector and sectors sensitive to interest rates, such as real estate and finance.
Hourly work, a key fact
Minnesota recently expanded the entitlement to state unemployment benefits to tens of thousands of school workers paid by the hour during the summer holidays, which also contributed to the rise in applications.
The rally reversed towards the end of the month, which some economists attributed to the Liberation Day holiday. Others, however, argued that the impact of the new holiday was unknown.
Applications, relative to the size of the labor market, are below the 280,000 level that economists say would signal a significant slowdown of job growth, which has averaged 314,000 jobs a month this year.
The labor market remains firm
The labor market has held firm despite the Federal Reserve’s interest rate hikes by 500 basis points since March 2022, when the central bank launched its fastest monetary-tightening campaign in more than 40 years to reduce inflation.
A survey conducted last month showed that consumer opinion about the labor market was more optimistic in June than in May.
Source: Ambito
