The number of initial claims for U.S. unemployment benefits rose to its highest level in eight months, exceeding economists’ predictions of 235,000 new applications. According to the Labor Department, the figure reached 247,000 for the week ending May 31, an increase of 8,000 from the previous week.
Despite this uptick, overall filings for unemployment claims remain at historic lows, with a total of 1.9 million Americans receiving benefits for the week of May 24. However, experts say the climb in initial jobless claims is a sign of broader shifts in the workforce ahead of the May jobs report.
A weak hiring rate means that newly unemployed workers are struggling to find new jobs quickly, and tariff-related uncertainty will add to these strains on the jobs market, according to Oliver Allen, senior U.S. economist at Pantheon Macroeconomics.
Other signs of a potential slowdown include a lower pace of hiring since May 2023, with the U.S. economy adding only 37,000 private sector jobs in May. Additionally, the number of Americans who quit their jobs fell in April, while layoffs climbed.
Major companies have also revealed layoffs this year, including Walmart and Procter & Gamble, which plan to cut 1,500 and 7,000 employees, respectively, due to increasing technological advances and economic pressure. The Labor Department is expected to report that employers added 130,000 jobs last month, down from 177,000 in April.
Source: https://www.cbsnews.com/news/unemployment-claims-highest-in-8-months