US Weekly Jobless Claims Rise Moderately
AInvestThursday, Oct 3, 2024 8:40 am ET
1min read
The number of Americans filing new applications for unemployment benefits increased marginally last week, pointing to a still-low level of layoffs even as the labor market slows. Initial claims for state unemployment benefits rose 2,000 to a seasonally adjusted 230,000 for the week ended Sept. 7, the Labor Department said on Thursday. Economists polled by Reuters had forecast 230,000 claims for the latest week.


Last week's data included the Labor Day holiday, which can make claims volatile. However, claims have been little changed since dropping from an 11-month high of 250,000 in late July. The slowdown in the labor market is being driven by businesses scaling back on hiring as higher interest rates curb demand throughout the economy.

Government data last week showed nonfarm payrolls increasing by less than expected in August, but the unemployment rate falling to 4.2% from 4.3% in July. Against the backdrop of a labor market slowdown, the Federal Reserve is expected to start its policy easing cycle next Wednesday, with a 25 basis points rate cut guaranteed after the annual increase in consumer prices slowed considerably in August, though some stickiness in inflation remained.


The number of people receiving benefits after an initial week of aid, a proxy for hiring, increased 5,000 to a seasonally adjusted 1.850 million during the week ending Aug. 31, the claims report showed. The so-called continuing claims have mostly trended lower through August after surging in July to levels last seen in late 2021. The decline is consistent with the drop in the unemployment rate last month.

The rise in jobless claims, while moderate, suggests a slight increase in layoffs and a potential slowdown in hiring. However, the overall level of claims remains low, indicating a still-healthy labor market. As businesses adapt to higher interest rates and a slowing economy, the Federal Reserve will likely consider the labor market's health in its monetary policy decisions.
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