New jobless claims were at 232,000 last week, down more than 15,000 from the previous week and the lowest level in two months, according to the Labor Department’s report on Thursday. Economists had expected jobless claims to total 240,000 last week. The data suggest that we continue to heal from the Great Recession, but that improvements in labor markets still have a long way to go before they reach typical levels seen prior to the recession, said Elise Gould of the Economic Policy Institute.
Regular Jobless Claims
Initial filings for unemployment insurance fell to their lowest level since late June last week, a sign that the labor market is resilient amid a slowing economy.
Claims totaled a seasonally adjusted 232,000 for the week ended Aug. 27, a decline of 5,000 from the previous period and the lowest since June 25, the Labor Department reported Thursday.
The number 245,000 was what economists polled by Dow Jones had anticipated.
Data that is one week behind the headline number shows that continuing claims jumped to 1.44 million, up 26,000 from the previous level.
Even though it is outside of the survey week that the Bureau of Labor Statistics uses to compile that count, the numbers come out a day ahead of the closely watched nonfarm payrolls report for August. Wall Street anticipates the data to reveal 318,000 new jobs added in August, a statistically famously unstable month.
The labour market has served as a bulwark amid concerns that the United States is on the verge of recession, showing that hiring demand is strong and consumer spending has kept up despite skyrocketing prices.
The BLS reported earlier this week that there are now over 11.2 million open positions, just under two to one more than there are available workers. Although private employers only gained 132,000 jobs in August, according to data released on Wednesday by payroll processing company ADP, the majority of experts have so far stuck to their August growth predictions.
The Federal Reserve has been aggressively raising interest rates in an effort to close the employment gap and contain inflation. Inflation is still close to its highest point in more than 40 years, despite these changes.
Several Fed officials have said the rate movements are expected to continue during the previous several days. The Cleveland Fed’s Loretta Mester said in a speech on Wednesday that she anticipates the fed funds rate, a benchmark used by banks for overnight lending that is also linked to many consumer debt products, will increase over 4% by the beginning of 2023. The goal rate at the moment is between 2.25% and 2.5%.
Separate statistics from the BLS released on Thursday revealed that the second-quarter productivity decrease wasn’t as severe as first believed. The productivity level was revised upward by 0.5 percentage points from the first estimate and revealed a decrease of 4.1%. The economists anticipated a result of minus-4.3%.
Unit labour expenses, or the ratio of pay to production, increased by 10.2% for the quarter, which was 0.4 percentage points less than anticipated. But the 9.3% gain over the last four quarters is the greatest level since the first quarter of 1982.