| 28 May 2024, Tuesday |

US weekly jobless claims lowest in more than 52 years

Last week, the number of Americans submitting new claims for unemployment benefits fell to its lowest level in more than 52 years, as labor market conditions tightened further amid an acute labor shortage.

The drop in weekly jobless claims released by the US Labor Department on Thursday is adjusted for seasonal swings around this time of year.

The data came on the heels of news last week that the jobless rate had dropped to a 21-month low of 4.2% in November.

“The labor market continues to tighten on nearly every parameter and in almost every statistic that pertains to jobs,” said Conrad DeQuadros, senior economic advisor at New York-based Brean Capital.

The Labor Department said on Thursday that initial applications for state unemployment benefits fell 43,000 to a seasonally adjusted 184,000 for the week ending December 4. Reuters polled economists, who predicted 215,000 applications for the most recent week.

Claims have fallen from a peak of 6.149 million in early April of 2020. Applications normally increase as the weather cools, but analysts believe this seasonal tendency is unlikely to persist due to a tightening labor market.

Last week, unadjusted claims jumped by 63,680 to 280,665 due to large increases in submissions in California, New York, and Michigan.

“Volatility owing to seasonal tendencies will make unemployment claims data difficult to analyze in the coming weeks,” said Veronica Clark, a Citigroup economist in New York.

At the end of October, there were 11 million vacant jobs, making firms hesitant to let people go.

Nonetheless, the claims numbers are consistent with recent estimates on consumer spending, manufacturing, and service industry activity, which have shown that the economy was gathering speed in the fourth quarter following a pause in the July-September period.

The proliferation of the Omicron version of Covid-19, on the other hand, poses a concern to the economic prospects. While nothing is known about the new variation’s impact, based on the experience with the Delta variant, which was responsible for the worst economic growth rate in more than a year last quarter, a slowdown in hiring and demand for services is probable.

Previous Monday, the government announced that nonfarm payrolls climbed by 210,000, the fewest since December of last year.

According to the claims data, ongoing claims grew by 38,000 to 1.992 million in the week ending November 27. In the week ending November 20, there were 1.948 million persons getting benefits from all programs.

  • Reuters