OAN’s James Meyers
8:40 AM – Thursday, May 9, 2024
Unemployment benefit claims have climbed to their highest level since August 2023, initial filings show.
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Initial jobless claims increased by a staggering 22,000 to 231,000 in the week ending May 4th, according to Labor Department data released Thursday, which went way above economists’ expectations for 212,000 applications.
The four-week moving average, which helps clear out exaggerated numbers, increased to 215,000, up 4,750 from the previous week and the highest the figure has been since February.
Before this week, first-time applications hadn’t reached the 200,000-to-222,000 range in the past three months, according to Bloomberg.
The latest data also shows that the number of layoffs across America increased as well.
The newest report comes out after April’s jobs report came out weaker than expected, adding just 175,000 new positions in April, which fell way short of the expected 240,000 from analysts.
However, a month earlier, March experienced a surprising increase of 303,000 new roles, while February’s finished at 270,000.
Large layoffs have happened across America since the beginning of the month from large corporations like Peloton and Allen Media.
Additionally, jobless claims increased by the highest number in a month, to 1.79 million in the week that ended April 27th.
With inflation continuing to increase, Wall Street took back its expectations for three 25-basis-point rate cuts beginning in June.
Wall Street was only expecting two 25-basis-point cuts to take place at the beginning of September.
Ian Shepherdson at Pantheon Economics stated on Thursday, “We’d need to see at least a month of elevated readings to convince us that the trend really has turned.”
However, he forewarned that “In the run-up to the recessions of 1990-to-91 and 2001, payroll growth slowed from 150-to-200K to just about zero in only four months. The warning signs were downplayed because the most recent data looked fine, then suddenly, things changed. It’s too soon to be sure the same story is about to play out now, but the risk is higher than at any previous point in this cycle, and we are nervous.”
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