Recurring U.S. unemployment benefit claims jumped to the highest level since November 2021, indicating some softening in the labor market.
Continuing claims, or the number of people who have already filed an initial application and are now claiming unemployment benefits, rose by 61,000 to 1.87 million in the week ended April 8, Labor Department data showed Thursday. This figure can offer insight into how quickly out-of-work Americans are able to find a new job.
Separate data Thursday showed a gauge of manufacturing activity in the Philadelphia area plunged in April to the lowest level since May 2020 amid weak demand. Indicators of prices paid and received also fell to their lowest levels since the early months of the pandemic.
While the data can be volatile from week to week, the pickup in continuing claims adds to signs that the labor market is beginning to lose momentum. Initial claims have gradually ticked higher, job openings have fallen sharply this year and a number of companies — notably in technology and financial services — have announced thousands of job cuts in recent months.
That said, many employers are still reticent to let go of workers, even amid softening demand conditions, after the challenges they faced to fill a range of open positions across the economy.
Manufacturing has generally been in a slump since the Federal Reserve started hiking interest rates last year, but activity differs from one region to the next. In New York State, it unexpectedly expanded in April for the first time in five months as new orders and shipments snapped back.
Meantime, initial unemployment claims rose by 5,000 to 245,000 in the week ended April 15, according to the Labor Department’s report. The median forecast in a Bloomberg survey of economists was for 240,000 applications.
The four-week moving average in initial claims, which smooths out week-to-week volatility, ticked down to 239,750. For continuing claims, the average has risen every week since October.
On an unadjusted basis, claims declined, led by a pullback in California, Pennsylvania and Texas. They increased in New York and Georgia.
___
© 2023 Bloomberg L.P
Distributed by Tribune Content Agency, LLC.
