Jobless Rate in US Rise Slightly, But Layoffs Remain Low

By Thea Felicity

Jun 06, 2024 12:40 PM EDT

Job Fair Hosted On Chicago's Navy Pier
(Photo : Scott Olson/Getty Images)
CHICAGO, ILLINOIS - APRIL 11: Job seekers speak with recruiters during a job fair at Navy Pier on April 11, 2023 in Chicago, Illinois. Companies at the fair were seeking mostly seasonal employees to work in tourism related fields. The U.S. unemployment rate currently stands at 3.5%.
Americans applying for unemployment benefits rose slightly last week, despite layoffs staying at a healthy level amid ongoing inflation and high interest rates. 

As reported by ABC News, the Labor Department reported Thursday, June 6, that for the week ending June 1, unemployment benefit applications increased by 8,000 to 229,000, up from 221,000 the previous week. 

The four-week average of claims, which smooths out week-to-week fluctuations, fell by 750 to 222,250.

It's worth noting that weekly unemployment claims are a key indicator of the U.S. labor market's health, reflecting the number of layoffs. These claims have stayed at historically low levels since the COVID-19 pandemic caused millions of job losses in early 2020.

In April, U.S. employers added 175,000 jobs, the fewest in six months, suggesting a potential cooling of the labor market. The unemployment rate edged up to 3.9% from 3.8%, remaining below 4% for 27 consecutive months, the longest streak since the 1960s.

Additionally, job openings fell to 8.1 million in April, the lowest since 2021. This moderation in hiring pace, alongside slowing wage growth, could provide the Federal Reserve with the data needed to consider cutting its benchmark interest rate. 

A cooler inflation reading in the first week of June may also influence the Fed's rate decision next week.

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Low-rate Layoffs

Despite the generally low layoff numbers, several prominent companies have recently announced job cuts, primarily in the technology and media sectors. 

Companies like Google, Apple, and other tech giants have all reported layoffs, alongside non-tech firms such as Nike, Peloton, Tesla and Walmart.

As of the week ending May 25, 1.79 million Americans were receiving jobless benefits, an increase of 2,000 from the previous week.

READ NEXT: US Unemployment Claims Rise as Layoffs Increase, Indicating Weak Labor Market

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