Initial unemployment claims unexpectedly jumped to total 230,000 last week, but still remained low compared to their pandemic-era averages.
The Labor Department released its latest weekly jobless claims report Thursday at 8:30 a.m. ET. Here were the main metrics from the print, compared to consensus estimates compiled by Bloomberg:
Initial jobless claims, week ended Jan. 8:230,000 vs. 200,000 expected, 207,000 during prior week
Continuing claims, week ended Jan. 2:1.559 million vs. 1.733 million expected, 1.754 million during prior week
Despite the rise in filings for first-time unemployment claims, jobless claims have held near or below their pre-virus levels for more than a month, underscoring the continued slowdown in firings and other involuntary separations as employers retain their existing workforces. New claims had averaged around 220,000 per week throughout 2019. And in early December, weekly claims hadimproved to come in below 190,000 for the lowest since 1969.
"The underlying trend is still falling; we expect new lows at the end of the month," Ian Shepherdson, chief economist for Pantheon Macroeconomics, wrote in a note earlier this week.
And meanwhile, continuing claims tracking the total number of Americans claiming benefits on regular state programs fell to a multi-decade low in the latest weekly data. At 1.559 million, the number of continuing claims was at its lowest since 1973.
The latest weekly jobless claims data comes amid a bevy of labor market prints showing demand — and leverage — for many workers remains strong. Last week's monthly jobs report showed a bigger-than-expected improvement in theunemployment rate to 3.9%, or the lowest level since February 2020.And though monthly payroll gains have slowed, many economists have attributed this to a lack of available workers to fill vacancies, rather than a lack of desire for additional workers.
Still, with the size of the civilian labor force still down by more than 2 million individuals compared to pre-pandemic levels, the labor market has some distance. still left before achieving policymakers' target of full employment. And while the job market has shown an encouraging improving trend throughout last year, persistently elevated inflation could be one factor threatening to derail further progress, according to some key officials.
"High inflation is a severe threat to the achievement of maximum employment," Federal Reserve Chair Jerome Powell said during his renomination testimony before the Senate Banking Committee on Tuesday. "If inflation does become too persistent — if these high levels of inflation get entrenched in our economy and people’s thinking — then inevitably that will lead to much tighter monetary policy from us, and it could lead to a recession, and that would be bad for workers."
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