The highest level of recurring claims for unemployment benefits in the US since November 2021 reflects a weakened labor market. This year has witnessed a significant decline in job opportunities and several firms, particularly in the technology and financial sectors, have revealed thousands of job cuts in the past few months.
However, despite the declining demand conditions, a lot of employers are hesitant to lay off their workforce due to difficulties in filling numerous vacant positions across various sectors of the organization.
The number of continuing claims by individuals, who have already filed for unemployment benefits and are still receiving them, has increased by 61,000 to 1.87 million as of April 8. This is an indication of how promptly unemployed individuals in the US are finding new jobs, as per the data released by the Labor Department on Thursday.
Subsequently, another set of data shows that manufacturing activity in the Philadelphia region declined significantly in April, hitting its lowest since May 2020 due to a lack of demand.
Although weekly data can fluctuate, the increase in continuing claims suggests that the US labor market is starting to slow down. Unemployment claims rose by 5,000 to 2,45,000 in the week that ended on April 15th, as per the report produced by Labor Department.
Moreover, there has been a gradual rise in initial claims, a significant decline in job opportunities this year, and several firms, especially in the technology and financial sectors, have revealed plans to eliminate thousands of positions in the past few months, all of which point towards a weakening labor market.
