US jobless claims fall for second week in sign of labour strength

APPLICATIONS for US unemployment insurance fell for the second week, suggesting that employers are holding on to workers despite growing economic uncertainty. 

Initial unemployment claims decreased by 2,000 to 243,000 in the week ended Aug 20, Labor Department data showed on Thursday (Aug 26). The median estimate in a Bloomberg survey of economists called for 252,000 new applications.

Continuing claims for state benefits fell to 1.42 million in the week ended Aug 13.

The decline in jobless claims points to still-robust labour demand as companies try to attract and retain employees amid lingering worker shortages. Even so, some employers – particularly those in the technology sector – have been laying off staff or freezing hiring, which could continue in the coming months as the Federal Reserve raises interest rates to curb demand and tame inflation.

On an unadjusted basis, initial claims declined to about 184,000 last week. New Jersey, Indiana and California had the largest declines in initial claims, while Massachusetts posted an outsized increase.

The 4-week moving average, which smooths out volatile week-to-week moves, rose slightly to 247,000. BLOOMBERG