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US Jobless Claims Held Near Historic Lows

Despite indications of economic slowdown, new applications for unemployment benefits remained near historic lows.  This is signaling how tight the U.S. labor market still is, even though many employers are still scrambling to hire, while others are reducing their workforce.

The Numbers

Initial jobless claims are typically used to show the trend of layoffs across the U.S.  As of last week these claims fell to 229,000 from the 231,000 the week before.  229,000 is still slightly higher than pre-pandemic average levels of 218,000 in 2019 when the job market was also extremely tight.  Claims have continued to drop since then, however, have not remained at the same level.

Additionally, in last week’s report, the continuing claims (which is typically used to appraise the number of people receiving payment from state programs) rose to 1.32 million from 1.31 million a week prior.  This again remains near a historic low, even though it increased from 1.31 the week prior.

Overview

After seeing these figures there are some conclusions you could make, such as permanent layoffs do not seem to be something happening right now.  Even if layoffs are rising, unemployed workers are finding new jobs relatively quickly.

Even with this being the case, the job market appears to be cooling as U.S. employers added 390,000 jobs in May which is below the average monthly pace of growth earlier this year.  Additionally, job openings slipped in April after hitting a record high in March and wage gains have also been seen tapering off.

Wrap Up

There are many factors contributing to the trends seen in the job market, including inflation and soaring interest rates.  Many employees and employers alike are also looking ahead to a potential recession and are left wondering what uncertainty lies in front of them.

 
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