The U.S. Labor Department reported that the four-week moving average for jobless claims through the week ending May 6 was the highest it’s been since November 2021. First-time claims for unemployment insurance increased by 22,000 from last week to reach 264,000. The less-volatile, four-week moving average to the week ending May 6 was 245,250, an increase of 6,000 from last week. The department reported: “This is the highest level for this average since November 20, 2021, when it was 249,250.”
However, the number of people who’ve filed over multiple weeks during the week ending April 22 was 1.7 million – a decline of nearly 64,000 from the prior week (at the same period last year, there were 1.44 million in continued-week claims).
The uptick in first-time claims may be good news towards fighting inflation. Jerome Powell, the head of the Federal Reserve, said last week that the 25 basis point rate hike was to ensure the labor market remains healthy while at the same time keeping prices stable. Economists say that last week’s surge could mark the start of an upward trend as the cumulative and lagged effects of the Fed’s rate hikes broaden out in the economy. Layoffs also appear to be spreading to other industries. Most were initially based in the technology sector; for example IBM, Microsoft, Salesforce, Twitter, Lyft and DoorDash have all announced layoffs in recent months, and Amazon and Facebook have each announced two sets of job cuts since November. But now other industries including McDonald’s, Morgan Stanley and 3M have also recently announced layoffs.
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