Insured Unemployment Drops by 42,000 After Hitting 3-Year High

Initial claims for unemployment benefits fell more than expected last week, while the insured unemployment number dropped by 42,000 after hitting a three-year high.

The number of Americans filing initial claims for unemployment insurance dropped by 16,000 during the week ended Saturday (Jan. 25), the Department of Labor said in a Thursday (Jan. 30) press release. The number dropped to 207,000, down from the previous week’s 223,000.

The four-week moving average declined by 1,000, decreasing to 212,500 after being gauged at 213,500 a week earlier, according to the release.

The week’s drop in initial claims was greater than that expected by economists, Reuters reported Thursday. Those polled by Reuters had expected to see 220,000 initial claims.

The number reported by the Department of Labor suggests few layoffs and a labor market that continues to “plod along,” the report said.

Bloomberg reported Thursday that the drop in initial claims was the biggest seen in six months.

The Department of Labor also reported Thursday that the number for insured unemployment dropped by 42,000 during the week ended Jan. 18. It dropped to 1,858,000 after reaching 1,900,000 a week earlier. The previous week’s figure was revised up by 1,000 from the 1,899,000 previously reported by the Department.

The previous week’s figure was the highest level for insured unemployment seen since November 13, 2021, when it reached 1,974,000, the Department of Labor reported Jan. 23. During the week ended Jan. 11, the insured unemployment number increased by 46,000,

The insured unemployment rate stood at 1.2% during the week ended Jan. 18, which was unchanged from the previous week, according to the Thursday press release.

The state with the greatest increase in initial claims during the week ended Jan. 18 was California, which had 5,725 more than it had during the prior week.

The state with the greatest decrease that week was Michigan, which reported 9,351 fewer initial claims than it had a week earlier. The state attributed the drop to fewer layoffs in manufacturing.

The state with the third-greatest decrease, Ohio, also reported that it saw fewer layoffs in manufacturing during the week.

The Conference Board said Tuesday (Jan. 28) that concerns about labor market conditions drove a decline in consumer confidence in January, though consumer confidence remained within the narrow range it has been in since 2022.