Applications for US jobless benefits fall to lowest since May

Published Thu, Sep 8, 2022 · 09:03 PM

Applications for US unemployment insurance fell for a fourth straight week to the lowest since May, suggesting demand for workers remains healthy despite an uncertain economic outlook.

Initial unemployment claims decreased by 6,000 to 222,000 in the week ended Sep 3, lower than all estimates, Labor Department data showed on Thursday (Sep 8). The median estimate in a Bloomberg survey of economists called for 235,000 new applications.

The 4-week moving average, which smooths out volatile week-to-week moves, fell to 233,000 – the lowest since early July.

Continuing claims for state benefits rose 36,000 to 1.47 million in the week ended Aug 27.

After some choppiness over many of the summer months, unemployment claims have been trending down in recent weeks, consistent with a tight labour market. The US added more than 300,000 jobs in August, and openings remain near a record – indicating a strong appetite for hiring.

Job growth may slow, however, as the Federal Reserve continues on an aggressive path of interest rate hikes to tame decades-high inflation. Chair Jerome Powell said in a speech last month that the labour market is “clearly out of balance”, as demand for workers far exceeds supply. He is due to speak again later.

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Some companies, particularly in the housing and technology sectors, are already scaling back hiring efforts. Citigroup joined rivals in trimming the ranks of its mortgage workforce, while tech investment firm SoftBank Group is cutting positions in the US among other regions.

On an unadjusted basis, initial claims increased by almost 2,000 to 175,842 last week. Filings rose the most in Massachusetts and Oklahoma. New York and Michigan posted the largest declines after increases in the prior week. Claims were estimated in the latest week for 4 states. bloomberg

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