Weekly jobless claims in the United States at their highest in almost 8 months

WASHINGTON (AP) — The number of Americans filing for unemployment benefits last week hit its highest level in nearly 8 months, but the total number of those collecting benefits fell.

Claims for unemployment assistance for the week ending July 9 rose by 9,000 to 244,000, from 235,000 the previous week, the Labor Department reported Thursday. The first requests generally reflect layoffs. Analysts expected the number to remain stable from the previous week.

The four-week average for claims, which evens out some of the week-to-week volatility, rose 3,250 from the previous week to 235,750.

The total number of Americans collecting unemployment benefits for the week ending July 2 fell by 41,000 from the previous week, to 1,331,000. That figure has hovered near 50-year lows for months.

Last week, the Labor Department reported that employers added 372,000 jobs in June, a surprisingly strong gain and in line with the pace of the previous two months. Economists had expected job growth to slow sharply last month given broader signs of economic weakness.

The unemployment rate remained at 3.6% for a fourth consecutive month, matching a nearly 50-year low that had been reached before the pandemic hit in early 2020.

The government also reported last week that US employers announced fewer jobs in May amid signs of a weakening economy, although overall demand for workers remained strong. There are nearly two job vacancies for every unemployed person.

On Wednesday, the government said consumer prices rose 9.1% from a year earlier, the biggest annual rise since 1981. From May to June, prices rose 1.3%, another considerable increase, after prices jumped 1% from April to May.

The Labor Department reported Thursday that wholesale inflation rose 11.3% in June from a year earlier.

All of these numbers reflect the unusual nature of the post-pandemic economy: inflation is hammering household budgets, forcing consumers to cut back on spending, and growth is weakening, heightening fears that the economy could fall. in recession.

In an effort to tackle the worst inflation in more than four decades, the Federal Reserve raised rates by half a point in May and another rare three-quarter point hike last month. Most economists expect the Federal Reserve to raise its borrowing rate by a half to three-quarters point when it meets later this month.

In addition to splitting the average American’s income, these rate increases also increase borrowing costs, rents and mortgage payments for businesses, reducing profits. Investors responded by pulling out of the stock market and piling into the bond market. Year to date, the S&P 500 is down about 20%, the Dow Jones industrials are down about 15%, and the Nasdaq is down more than 28%.

Although the job market is still strong, high profile layoffs have recently been announced by Tesla, Netflix, Carvana, Redfin and Coinbase.

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