Applications for US unemployment benefits rose for the first time in six weeks but remained historically low, underscoring the resilience of the job market despite mounting economic uncertainty.
(Bloomberg) — Applications for US unemployment benefits rose for the first time in six weeks but remained historically low, underscoring the resilience of the job market despite mounting economic uncertainty.
Initial unemployment claims rose by 13,000 to 196,000 in the week ended Feb. 4, Labor Department data showed Thursday. The median forecast in a Bloomberg survey of economists called for 190,000 applications.
Continuing claims, which include people who have already received unemployment benefits for a week or more, increased to 1.69 million in the week ended Jan. 28.
The US labor market has remained firm in the backdrop of the Federal Reserve’s most aggressive tightening campaign in a generation. Despite a rising number of layoffs spreading beyond tech companies, many business — particularly smaller ones — are still struggling to hire, while others are holding onto staff they worked so desperately to on-board.
Walt Disney Co. said Wednesday it’s cutting 7,000 jobs as part of a broader restructuring that will save the entertainment company $5.5 billion. Boeing Co. expects to cut about 2,000 jobs this year primarily in finance and human resources, the Seattle Times reported this week.
The data come a week after a separate government report showed payrolls unexpectedly surged last month while the unemployment rate fell to a 53-year low. Even though seasonal adjustments and other revisions may have played a role, Fed officials have said the data reinforces the need for more interest-rate hikes to combat inflation.
The four-week moving average in initial claims, which smooths out some of the week-to-week volatility, edged down to 189,250, the lowest since late April.
What Bloomberg Economics Says…
“We foresee only a modest rise in layoffs over the near term with job cuts contained to a limited number of sectors… Still, it was the fourth straight week claims held below 200k, underscoring the tightness of the labor market and implying that it will take some time to tamp down price pressures.”
— Eliza Winger, economist
To read the full note, click here
On an unadjusted basis, initial claims rose to 234,654, led by California and Ohio.
A survey of chief executives by the Conference Board, in collaboration with the Business Council, found that 57% report some problems attracting qualified workers, while 81% expect to boost wages by at least 3% over the coming year.
“While CEOs are still girding for a recession in 2023, they continue to experience a tight labor market,” Roger Ferguson, vice chairman of Business Council and trustee of the Conference Board, said in a statement Thursday.
–With assistance from Jordan Yadoo.
(Adds Bloomberg Economics comment)
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