US jobless claims decline for third week to 2-month low

Published Thu, Sep 1, 2022 · 08:57 PM

APPLICATIONS for US unemployment insurance fell for a third week to a 2-month low, suggesting healthy demand for labour even as economic growth moderates. 

Initial unemployment claims decreased by 5,000 to 232,000 in the week ended Aug 27, Labor Department data on Thursday (Sep 1) showed. The median estimate in a Bloomberg survey of economists called for 248,000 new applications.

Continuing claims for state benefits rose to 1.44 million in the week ended Aug 20 from 1.41 million.

The level of first-time claims, in addition to a still-low number of Americans already on unemployment benefit rolls, underscores tightness in the broader labour market. A separate report on Tuesday showed that job openings surged in July, near the highest level on record.

“These timely data show that labour market conditions are not weakening dramatically, with lay-offs not yet picking up in a sustained way in response to Fed tightening,” Rubeela Farooqi, chief US economist at High Frequency Economics, said in a note. 

At the same time, some companies are scaling back as some parts of the economy, such as housing and technology, weaken after booming early in the pandemic recovery. Snap Inc said earlier this week that it would cut 20 per cent of its workforce in an effort to cut costs.

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On an unadjusted basis, initial claims decreased to 176,793 last week. Most states had fewer new claims, led by Connecticut, Missouri and Oklahoma. Filings increased in New York and Massachusetts.

The 4-week moving average, which smooths out volatile week-to-week moves, decreased to 241,500, the lowest since Jul 9. BLOOMBERG

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