Topline
New applications for unemployment benefits hit an 8-month high last week, though overall jobless claims remain low, according to a report released by the Labor Department on Thursday, as some companies begin to announce cutbacks amid fears of a recession and rising inflation.
A job seeker looks at a job listing board.
Key Facts
Applications for unemployment benefits for the week ending July 9 rose by 9,000 to 244,000, up from 235,000 the week before.
The claims—which rose for the second week in a row—were the highest since mid-November 2021.
But continuing claims for state benefits for the week ending July 2—which are reported with a one week delay—fell by 41,000 to 1.3 million, the biggest decline since April.
Despite the uptick in new claims, the number of Americans applying for unemployment benefits is “still low,” Bill Adams, Chief Economist for Comerica Bank said in a statement, adding the U.S. has the lowest share of workers claiming continued unemployment benefits “since comparable records began in 1971.”
Big Number
372,000. That’s how many jobs employers added in June, the Labor Department reported last week, a strong gain and on pace with the two months before, while the unemployment rate remained at 3.6% in June for the fourth month in a row.
Key Background
The report comes after the Labor Department Wednesday said inflation hit a 40-year high of 9.1% in the 12 months ending in June—fueled by surging gasoline, shelter and food prices—with overall prices rising 1.3% from May, as fears of a recession continue to mount. Wholesale inflation also rose 11.3% from a year ago, the Labor Department said on Thursday, a near high since a record 11.6% surge in March. In an attempt to address skyrocketing inflation, the Federal Reserve hiked interest rates by half a point in May followed by a three-quarter increase in June. Though the labor market remains tight, some major companies, including Tesla, Netflix and Microsoft have announced layoffs in recent weeks.
Further Reading
U.S. Weekly Jobless Claims Hit 8-Month High; Producer Prices Come in Hot (Reuters)
Wholesale prices shoot up near-record 11.3% in June on surge in energy costs (CNBC)
Source: https://www.forbes.com/sites/madelinehalpert/2022/07/14/weekly-jobless-claims-hit-new-high-for-2022/