Applications for US unemployment benefits dropped last week to the lowest level since January as the labor market kept powering ahead.
(Bloomberg) — Applications for US unemployment benefits dropped last week to the lowest level since January as the labor market kept powering ahead.
Initial jobless claims fell to 198,000 in the week ending Oct. 14, according to Labor Department data out Thursday. That was below all estimates in a Bloomberg survey of economists.
Continuing claims, a proxy for the number of people receiving unemployment benefits, rose to 1.73 million in the week ended Oct. 7. That marked the highest level since July, indicating those losing their jobs may be having more trouble finding new ones.
Thursday’s reading returned initial filings for unemployment insurance to near the lowest levels since the pandemic began, showcasing a labor market that continues to defy economists’ projections. Appetite for workers remains high, with employers across sectors adding jobs at a solid pace.
“Demand is moderating but remains historically strong, while layoffs are running well below the norms, even for tight labor market episodes in the past,” Stephen Stanley, chief economist at Santander US Capital Markets, said in a note to clients after the release. “The labor market remains red hot.”
Looking ahead, the monthlong strike by the United Auto Workers union against the three largest automakers in the US could lead to an uptick in jobless claims. While striking workers don’t qualify for unemployment benefits in most states, Stellantis NV, General Motors Co. and Ford Motor Co. have furloughed thousands of workers in plants across the country so far.
The data can be especially choppy around the holidays, and last week included Columbus Day. The four-week moving average of initial claims, which smooths out some of that volatility, ticked down for a seventh straight week, to the lowest level since February.
On an unadjusted basis, claims fell to 181,181. Texas, New York and California led the decline.
The figures correspond with the reference period for the monthly employment report published by the Bureau of Labor Statistics.
–With assistance from Jordan Yadoo.
(Updates with video.)
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