First-time claims for U.S. unemployment benefits saw another modest increase in the week ended August 6th, according to a report released by the Labor Department on Thursday.
The report showed initial jobless claims rose to 262,000, an increase of 14,000 from the previous week’s revised level of 248,000.
Economists had expected jobless claims to inch up to 263,000 from the 260,000 originally reported for the previous week.
With the increase, jobless claims reached their highest level since hitting 265,000 in the week ended November 13, 2021.
“Weakening labor market dynamics lend upside risk to claims in the weeks ahead,” said Oren Klachkin, Lead U.S. Economist at Oxford Economics.
He added, “However, we don’t anticipate a sharp increase in joblessness given that labor demand continues to outpace supply and the economy remains on a positive, albeit modest, growth trajectory.”
The Labor Department said the less volatile four-week moving average also crept up to an eight-month high of 252,000, an increase of 4,500 from the previous week’s revised average of 247,500.
Continuing claims, a reading on the number of people receiving ongoing unemployment assistance, also edged up by 8,000 to 1.428 million in the week ended July 30th.
The four-week moving average of continuing claims rose to 1,399,250, an increase of 23,750 from the previous week’s revised average of 1,375,500.
“Looking ahead, a tight labor market and our expectation that more workers will return to the labor force are expected to keep a lid on continued claims,” Klachkin said.
Last Friday, the Labor Department released a separate report showing employment in the U.S. jumped by much more than expected in the month of July.
The report showed non-farm payroll employment spiked by 528,000 jobs in July after surging by an upwardly revised 398,000 jobs in June.
Economists had expected employment to climb by about 250,000 jobs compared to the addition of 372,000 jobs originally reported for the previous month.
With the stronger than expected job growth, the unemployment rate unexpectedly edged down to 3.5 percent July from 3.6 percent in June. The unemployment rate was expected to remain unchanged.
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