The number of Americans filing for unemployment last week fell after an earlier increase in what some saw as a sign that rising interest rates have finally cooled the job market.
The Labor Department reported Thursday that claims for unemployment insurance fell 22,000 to 264,000 from 242,000 for the week ending May 13. The weekly data is believed to be a reflection of layoffs in the United States.
The four-week moving average – which smooths weekly volatility – fell 1,000 to 244,250. Analysts have pointed to the continued rise in the four-week average as a sign that layoffs are accelerating, but have declined to speculate that an increase in layoffs is imminent.
Overall, 1.8 million people received unemployment benefits in the week ending April 29, about 8,000 fewer than the previous week.
Since the pandemic wiped out millions of jobs that began three years ago, the US economy has added jobs at a breakneck pace and American workers enjoy unusual job security despite rising interest rates, economic uncertainty and fears of an impending recession.
This month, the Fed raised its benchmark interest rate for the tenth time in a row as it tries to cool the economy and reduce the highest rate of inflation seen in four decades. While the labor market continues to support workers, there have been some recent signs that the Fed’s actions are working.
In April, employers added 253,000 jobs and the unemployment rate fell to 3.4%, matching a 54-year low. However, the numbers for February and March were updated by 149,000 jobs, which may indicate that the Fed’s rate strategy is starting to cool the job market.
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