The Labor Department released a report on Thursday showing a modest decrease in first-time claims for U.S. unemployment benefits in the week ended February 7th.
The report said initial jobless claims dipped to 227,000, a decrease of 5,000 from the previous week’s revised level of 232,000.
Economists had expected jobless claims to fall to 220,000 from the 231,000 originally reported for the previous week.
The smaller-than-expected decline came a week after jobless claims reached their highest level in nearly two months.
“Initial claims in the week ended February 7 reversed only a small part of their spike from the prior week,” said Nancy Vanden Houten, Lead U.S. Economist at Oxford Economics.
She added, “While claims remain above the low levels of late December and early January, they remain at a level consistent with a low pace of layoffs.”
Meanwhile, the Labor Department said the less volatile four-week moving average rose to 219,500, an increase of 7,000 from the previous week’s revised average of 212,500.
The report also said continuing claims, a reading on the number of people receiving ongoing unemployment benefits, climbed by 21,000 to 1.862 million in the week ended January 31st.
The four-week moving average of continuing claims still fell by 3,250 to 1,846,750, the lowest level since the week ended October 5, 2024.
“The low hiring rate is still the most concerning aspect of the current labor market, but the trend in continued claims suggests employers aren’t pulling back further,” said Vanden Houten.
A more closely watched report released by the Labor Department on Wednesday showed employment in the U.S. increased by much more than expected in the month of January.
The Labor Department said non-farm payroll employment jumped by 130,000 jobs in January after rising by a downwardly revised 48,000 jobs in December.
Economists had expected employment to climb by 70,000 jobs compared to the addition of 50,000 jobs originally reported for the previous month.
The report also said the unemployment rate edged down to 4.3 percent in January from 4.4 percent in December, while economists had expected the unemployment rate to remain unchanged.
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