The Labor Department released a report on Thursday showing first-time claims for U.S. unemployment benefits climbed much more than expected in the week ended May 6th.
The report said initial jobless claims rose to 264,000, an increase of 22,000 from the previous week’s unrevised level of 242,000. Economists had expected jobless claims to inch up to 245,000.
With the much bigger than expected advance, jobless claims reached their highest level since hitting a matching number in the week ended October 30, 2021.
The Labor Department said the less volatile four-week moving average also crept up to 245,250, an increase of 6,000 from the previous week’s unrevised average of 239,250.
The four-week moving average reached its highest level since hitting 249,250 in the week ended November 20, 2021.
Continuing claims, a reading on the number of people receiving ongoing unemployment assistance, also rose by 12,000 to 1.813 million in the week ended April 29th.
The four-week moving average of continuing claims also inched up to 1,829,500, an increase of 2,250 from the previous week’s revised average of 1,827,250.
“While the April jobs data surprised to the strong side, the latest jobless claims data are consistent with labor market conditions that are loosening,” said Nancy Vanden Houten, Lead U.S. Economist at Oxford Economics.
“It’s just one week of data, but the increase in claims last week pushed the four-week moving average for claims to the highest level since November 2021,” she added. “Evidence of cooling demand for labor will allow the FOMC to refrain from raising rates at the June meeting.”
Last Friday, the Labor Department released a separate report showing job growth in the U.S. far exceeded economist estimates in the month of April, the although the jump in employment followed notable downward revision to the two previous months.
The Labor Department said non-farm payroll employment shot up by 253,000 jobs in April compared to economist estimates for an increase of about 179,000 jobs.
However, the job growth in February and March was downwardly revised to 248,000 jobs and 165,000 jobs, respectively, reflecting a combined downward revision of 149,000 jobs.
The report also said the unemployment rate edged down to 3.4 percent in April from 3.5 percent in March. Economists had expected the unemployment rate to remain unchanged.
Source: Read Full Article