He Number of Americans quE presented new applications for unemployment benefits increased more than expected last week, but that probably does not indicate a material change in labor market conditions.
Initial applications for state unemployment benefits increased by 22,000, reaching the 242,000 seasonally adjusted for the week that ended on February 22, the Labor Department reported Thursday. The economists surveyed by Reuters had predicted 221,000 applications for the last week.
The seasonal adjustment factors, the model that the government uses to eliminate seasonal data fluctuations, tend to biased the figures of upward applications at this time of year.
A separate unemployment compensation program for federal employees (UCFE), which is informed with a week delay, did not yet impact on the mass layoffs of federal workers in the trial period, most of whom were fired around February 14 by the Government Efficiency Department of the billonary Elon Muskor Doge, an entity created by the Republican President Donald Trump.
The layoffs in charge of Doge
The dismissals, which are part of the efforts of the Trump administration to cut the expense and reduce the size of the federal government, have also affected employers with government contracts. Economists have warned that the reduction of money circulating in the economy due to the loss of payment checks and spending cuts could cause job losses in the private sector.
“These layoffs are likely to add the greatest dismissal in the history of the United States,” said Michele Evermore, principal researcher at the National Academy of Social Security. “Economic pain is contagious, so it is likely that federal layoffs cause more economic difficulties.”
Evermore, ex -sub -director policy in the Office of Modernization of Unemployment Insurance of the Department of Labor, warned that states do not have the administrative apparatus or technology to pay the benefits quickly.
For now, state unemployment applications still do not show a material change in labor market conditions. Historically low layoffs maintain the economic expansion in progress, which gives the Federal Reserve Space to maintain interest rates without changes while those responsible for the policy monitor the economic impact of fiscal, commercial and immigration policies of the Trump administration, seen as inflationary by economists.
The minutes of the Central Bank Meeting of the USA of January 28 and 29 published last week showed that those responsible for the policy were concerned about the highest inflation due to the initial proposals of Trump policies.
The Federal Reserve left its reference interest rate unchanged in the range of 4.25% -4.50% last month, after having reduced it by 100 base points since September, when its policy flexibility cycle began. The policy rate was increased by 5.25 percentage points by 2022 and 2023 to control inflation.
The number of people who receive benefits after the first week of help, an indicator of the hiring, decreased by 5,000, remaining at 1,862 million adjusted seasonally during the week that ended on February 15, according to the request report.
The so -called “continuous requests” cover the period in which the Government conducted the Household Survey for the February unemployment rate. The unemployment rate was 4.0% in January.
Although the labor market is still healthy, households are growing somewhat anxious about their prospects for getting a job if they are fired.
Source: Ambito
