Jobless Claims Drop While Total Unemployment Rises

The number of Americans filing for unemployment last week dropped, even as the number who are unemployed rose to the highest level since November 2021.

Reuters reported Thursday (July 10) that these figures suggest that employers are holding on to their current workers even though they have been cautious about adding more employees.

The Department of Labor (DOL) said in a Thursday press release that the number of initial claims for unemployment insurance decreased by 5,000 during the week that ended Saturday (July 5).

The total of 227,000 initial claims filed during the week was down from the previous week’s revised level of 232,000. The previous week’s number was revised down by 1,000.

The four-week moving average of 235,500 was 5,750 lower than the previous week’s revised average of 241,250. That number was revised down by 250, per the release.

The number of initial claims filed last week was lower than that expected by economists, who had forecast a total number of 235,000, Bloomberg reported Thursday.

The report noted that the week included the July 4 holiday and that new unemployment filings tend to be volatile around federal holidays and school summer breaks.

Reuters reported that the economists it polled had also predicted that 235,000 initial claims would be filed during the week.

The report added that the number was the lowest seen in seven weeks.

The Federal Reserve Bank of New York reported Tuesday (July 8) that labor market indicators showed signs of improvement. Households reported a lower perceived probability of losing their job, which dropped to 14%, the lowest since December.

In comments supplied to the DOL and included in the agency’s Thursday press release, the state with the greatest decrease in the number of claims filed during the week that ended June 28, Pennsylvania, attributed the drop to fewer layoffs in four industries: transportation and warehousing; accommodations and food services; administrative and support and waste management and remediation services; and healthcare and social assistance. Pennsylvania had 2,910 fewer initial claims.

The state with the greatest increase in the number of initial claims filed during that week, New Jersey, said it saw layoffs in the educational services and public administration industries.

The DOL also reported Thursday that the insured unemployment rate was 1.3% for the week that ended June 28, unchanged from the previous week.

The insured unemployment number for that week was 1,965,000, which was 10,000 higher than the previous week’s revised level of 1,955,000. The figure for the previous week was revised down by 9,000.

“This is the highest level for insured unemployment since November 13, 2021, when it was 1,970,000,” the DOL said in the release.