The number of Americans filing for unemployment benefits fell last week, potentially easing concerns about a major shift in the labor market. The Labor Department said Thursday that the number of people filing for state unemployment benefits fell 6,000 to a seasonally adjusted 233,000 in the week ended June 22. The data included a new holiday, Juneteenth, last Wednesday. Claims tend to fluctuate around public holidays.
So far this year, claims have fluctuated between 194,000 and 243,000. Economists are divided over whether the recent increase in claims indicates more layoffs or a repeat of last year’s swing. Claims remain historically low and are being closely watched for signs that employers are laying off workers as the economy slows. The Federal Reserve has raised interest rates by 525 basis points since 2022 to curb inflation.
In another report Thursday, the government confirmed that economic growth slowed significantly in the first quarter. The Commerce Department’s Bureau of Economic Analysis said the first-quarter gross domestic product growth rate was slightly raised to an annualized 1.4%, the third estimate of GDP for the January-March quarter. The previous growth estimate was 1.3%. The economy grew at a 3.4% rate in the fourth quarter.
The U.S. central bank has kept its benchmark overnight rate in a range of 5.25%-5.50% since July last year. According to the unemployment claims report, the number of people continuing to receive benefits after an initial aid increased by 18,000 to a seasonally adjusted 1.839 million in the week ended June 15. These so-called continuing claims data cover households during the period when the government surveyed unemployment in June. The unemployment rate rose to 4.0% in May, the first increase since January 2022. However, most economists do not view the current unemployment level as a threat to the labor market, arguing that the increase in unemployment is mainly concentrated in the 35-44 age group, recent immigrants and certain industries.
