US weekly jobless claims unchanged; layoffs decline in April

WASHINGTON: The number of Americans filing new claims for unemployment benefits held steady at lower levels last week as the labour market remains fairly tight.

Initial claims for state unemployment benefits were unchanged at a seasonally adjusted 208,000 for the week ended April 27, the Labor Department said on Thursday.

Economists polled by Reuters had forecast 212,000 claims in the latest week. Claims have been bouncing around in a 194,000-225,000 range this year.

Though demand for labour is softening, with job openings falling to a three-year low in March, layoffs remain very low as companies hang on to their workers following challeges finding labour during and after the COVID-19 pandemic.

The Federal Reserve on Wednesday kept the U.S. central bank’s benchmark overnight interest rate unchanged in the current 5.25%-5.50% range, where it has been since July.

Since March 2022, the Fed has raised its policy rate by 525 basis points. Labour costs and inflation surged in the first quarter.

Fed Chair Jerome Powell told reporters on Wednesday that progress lowering inflation had stalled. Powell described the labour market as having remained “relatively tight,” but also noted that “supply and demand conditions have come into better balance.”

The number of people receiving benefits after an initial week of aid, a proxy for hiring, were also unchanged at a seasonally adjusted 1.774 million during the week ending April 20, the claims report showed.

A separate report from global outplacement firm Challenger, Gray & Christmas on Thursday showed U.S.-based employers announced 64,789 job cuts in April, a 28% drop from March. Planned layoffs were 3.3% lower compared to a year ago. So far this year, companies have announced 322,043 job cuts, down 4.6% from the same period last year.

The claims data have no bearing on April’s employment report, scheduled to be published on Friday. Nonfarm payrolls likely increased by 243,000 jobs in April after advancing by 303,000 in March, according to a Reuters survey of economists. The unemployment rate is forecast unchanged at 3.8%. – Reuters