U.S. Jobless Claims Rise as Labor Market Momentum Cools
Initial jobless claims in the U.S. rose unexpectedly last week, pointing to a slowdown in labor market momentum. Jobless claim applications were up 7000 in the week ended on January 9, reaching 284,000. Initial jobless claims have not been this high since July, according to the report from the Labor Department. Economists forecasted a decline of 275,000.
Concerns over a slowdown in China and other emerging economies have agitated equity markets, which may cause some employers to be more cautious about hiring new staff. With that said, economists note that it’s not uncommon for claims to be volatile during this time of year, as employers are still adjusting after the holidays.
The four-week moving average of jobless claims, which is a less volatile measure, jumped from 275,750 to 278,750. The average was still the highest since July.
The number of people who continue to receive jobless benefits jumped to 2.26 million in the week ended January 2, up 29,000. The unemployment rate jumped to 1.7%, up from 1.6%.
In March of 2015, jobless claims fell below 300,000, a level that is synonymous with a strengthening labor market. Claims still remain below this level, but a slowdown in the economy during the latter half of 2015 may lead to more dismissals and layoffs in the near future.
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