More Americans filed for unemployment benefits last week, and while the job market remains broadly healthy, there are growing signs that it may finally calm down.
Claims for unemployment benefits rose by 13,000 to 231,000 for the week ending Nov. 11, the Labor Department reported Thursday. This is the most in three months.
Unemployment claims claims are viewed as representing the number of layoffs in a given week.
The Federal Reserve has been squeezing the economy and labor market for nearly two years, trying to stem what has been the highest inflation rate in four decades. The central bank has raised its benchmark interest rate 11 times since March 2022 as part of this effort.
However, for months it looked as if the Fed’s aggressive actions were having little effect, and companies were forced to pay their employees more.
However, cracks may be starting to appear.
Overall, 1.87 million people were receiving unemployment benefits in the week ending Nov. 4, about 32,000 more than the week before and the most in nearly two years. This is the sixth week in a row that continuing claims have risen.
“Job growth remains strong, and companies have not yet begun to reduce their workforce in a significant way,” said Rubeela Farooqi, chief U.S. economist in the High Frequency Economics Division. “But the continuing claims data suggests some decline in labor demand, in line with what the Fed wants to see.”
Economists point out that continuing claims are rising steadily because many already unemployed may now have difficulty finding work, an indication that the labor market is more flexible than it was in the post-pandemic era.
Employers in the United States Their hiring slowed in October, which adds a modest but decent 150,000 jobs. It’s only the third time in nearly three years that monthly job gains have been below 200,000. However, all three of those instances have occurred in the past five months.
“The claims data is consistent with a labor market that is calm enough to keep rate hikes off the table, but too strong to consider rate cuts any time soon,” said economist Nancy Vanden Houten of Oxford Economics. “The Fed is certainly encouraged by the latest inflation data but needs to see a further slowdown in the labor market and wage growth to be convinced that inflation is on a sustainable path back to 2%.”
Fed officials chose to leave interest rates alone at their latest policy meeting. Another increase before the end of the year has not been ruled out, but recent data showed that inflation continues to ease, a priority for Federal Reserve Chairman Jerome Powell.
Overall inflation It did not rise from September to OctoberIt is the first time that consumer prices have not moved collectively from one month to the next in more than a year. Compared with the previous year, prices rose 3.2% in October, the smallest such rise since June, although still above the Fed’s 2% inflation target.
The four-week moving average of jobless claims rose 7,750 to 220,250.
“Infuriatingly humble alcohol fanatic. Unapologetic beer practitioner. Analyst.”