The U.S. labor market is still strong despite numerous economic headwinds, such as four-decade high inflation, and fewer Americans filing for unemployment benefits last week.
Washington, D.C. Since the U.S. job market is still strong despite four decades of high inflation and a variety of other economic stresses, fewer Americans requested unemployment benefits last week.
The Labor Department said on Thursday that the number of applications for unemployment benefits for the week ending June 18 dropped to 229,000, a decrease of 2,000 from the previous week. The number of openings typically tracks with the number of layoffs.
The week-to-week volatility is lessened somewhat by the four-week average of claims, which increased by 4,500 from the prior week to 223,500.
For the week ending June 11, 1,315,000 Americans in total were receiving unemployment benefits, an increase of 5,000 over the previous week. For months, that number has been close to 50-year lows.
Inflation levels not seen in forty years have somewhat negated the recent job security and salary increases that Americans have enjoyed.
Consumer prices increased 8.6% in June, even higher than in April, according to data from the Labor Department. The Federal Reserve responded by increasing its key borrowing rate, which is its primary weapon against rising prices, by three-quarters of a point last week. On top of a half-point gain in early May, this increment is now higher.
The government announced three weeks ago that American firms added 390,000 jobs in May, continuing a trend of steady hiring that has strengthened a fragile economy. Although there was solid employment growth in May, it was the lowest monthly rise in a year, and there have been indications that there may be more layoffs in the future, at least in some industries.
Although still at a low level, jobless claims applications over the previous several weeks have reached their highest level since the first few weeks of 2022.
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