Attendees at a career fair in Bolivia, North Carolina. Photographer: Allison Joyce/Bloomberg
The number of Americans on unemployment-benefit rolls climbed to a more-than-three-year high, while first-time applications for U.S. unemployment insurance edged slightly higher.
Continuing claims, a proxy for people who are already receiving benefits and still can’t find a job, jumped to 1.9 million in the week ended January 11—the highest since November 2021—according to Labor Department data released Thursday. Initial claims increased last week by 6,000, to 223,000. New applications for unemployment benefits are hovering near their pre-pandemic averages, a sign of a healthy labor market. But the rise in recurring claims suggests that unemployed people are beginning to have a tougher time finding a new job.
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It’s worth noting, however, that weekly numbers tend to be volatile, particularly at this time of the year. The four-week moving average of new applications, a metric that helps smooth out bumpiness, rose only slightly, to 213,500. “There has been the usual elevated volatility in the weekly readings for this time of the year, and weather and natural disasters are likely to keep the figures fluid over the next few weeks,” Stephen Stanley, chief economist for Santander US Capital Markets LLC, said in a note.
Economists are paying close attention to labor data for last week, because those statistics will be used to prepare this month’s employment report. The period was marked by devastating fires that tore through neighborhoods in Los Angeles.
Before adjusting for seasonal factors, initial claims dropped by about 68,000 last week, the most in three years. Four states provided only estimates, including California—which registered the biggest gain in applications—following a surge in the previous week.
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What Bloomberg Economists Say...
“Jobless claims remained relatively low in the survey week for the January jobs report, suggesting the month’s unemployment rate was little changed, despite the California wildfires. The new administration’s pro-business posture could reinvigorate capex spending and boost hiring. At the same time, President Donald Trump signed executive orders to reduce the size of federal-government employment, which will increase the number of unemployed.”————————————————————
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