US filings for unemployment benefits inch up slightly but remain historically low
Slightly more Americans filed for unemployment benefits last week, but layoffs remain at historically low levels despite two years of elevated interest rates.
Jobless claims rose by 2,000 to 230,000 for the week of Sept. 7, the Labor Department reported Thursday. That number matches the number of new filings that economists projected.
The four-week average of claims, which smooths out some of week-to-week volatility, ticked up by 500, to 230,750.
The total number of Americans collecting jobless benefits rose by a modest 5,000, remaining in the neighborhood of 1.85 million for the week of Aug. 31.
Weekly filings for unemployment benefits, considered a proxy for layoffs, remain low by historic standards, though they are up from earlier this year.
During the first four months of 2024, claims averaged a just 213,000 a week, but they started rising in May. They hit 250,000 in late July, adding to evidence that high interest rates were finally cooling a red-hot U.S. job market.
Employers added a modest 142,000 jobs in August, up from a paltry 89,000 in July, but well below the January-June monthly average of nearly 218,000.
Last month, the Labor Department reported that the U.S. economy added 818,000 fewer jobs from April 2023 through March this year than were originally reported. The revised total supports evidence that the job market has been slowing steadily and reinforces the Fed’s plan to start cutting interest rates later this month.
The Fed, in an attempt to stifle inflation that hit a four-decade high just over two years ago, raised its benchmark interest rate 11 times in 2022 and 2023. That pushed it to a 23-year high, where it has stayed for more than a year.
Inflation has retreated steadily, approaching the Fed’s 2% target and leading Chair Jerome Powell to declare recently that it was largely under control.
Most analysts are expecting the Fed to cut its benchmark rate by only a traditional-sized quarter of a percentage point at its meeting next week, not the more severe half-point that some had been forecasting.