US job data: Weekly jobless claims rise to eight-month high

Initial jobless claims in the United States last week rose to 244,000, the highest level in eight months and the latest sign that the labour market might be cooling.

In the week ending July 9, the number of Americans filing for unemployment benefits increased by 9,000 from the previous week’s unrevised level of 235,000, according to a report released by the department’s Bureau of Labor Statistics (BLS).

The four-week moving average for initial jobless claims, a method to iron out data volatility, increased by 3,250 to 235,750, the report showed.

Jobless claims have been trending up since March amid surging inflation and rising interest rates. Jobless claims totaled 166,000 in the week ending March 19, the lowest in decades, Xinhua news agency reported.

The latest figure of 244,000 is well above the 2019 weekly average of 218,000, which is the pre-pandemic level. In the week ending March 14, 2020, jobless claims totaled 221,000, but in the following week, the figure skyrocketed to 2.9 million.

The latest report also showed that the number of people continuing to collect regular state unemployment benefits, which was reported with a one-week lag, declined by 41,000 to 1.33 million during the week ending July 2.

The total number of people claiming benefits in all programmes — state and federal combined — for the week ending June 25, however, increased by 72,504 to 1.4 million.

“Over the past month, signals of a slowdown in the US economy have mounted,” economists at Wells Fargo Securities said in an analysis.

“Weaker real spending suggests that the staying power of US consumers is fading, housing activity is buckling under the weight of higher interest rates, and business investment is downshifting amid growing recession fears,” said the analysis.