The U.S. labor market is flashing mixed signals, with a new report showing a seven-month low in the number of weekly initial jobless claims but a three-year high in the number of American workers continuing to receive benefits after an initial filing, signaling fewer layoffs but increasing difficulty getting rehired.
The latest unemployment data from the Labor Department, released on Nov. 21, shows that initial claims for jobless benefits fell by 6,000 to 213,000 for the week ending Nov. 16, marking a seven-month low. However, continuing claims—representing those still receiving benefits after an initial filing—jumped by 36,000 to 1.91 million, the highest level in three years.
A number of analysts noted the mixed signals, with some saying the rise in continuing claims could boost the unemployment rate. Others went further, suggesting that the likelihood of a recession has increased.
“There is little evidence of large layoffs taking place,” said Gisela Hoxha, an economist at Citigroup. “However, in a low-hiring environment those individuals that are laid off are finding it harder to get a new job and are remaining on unemployment benefits for longer, which implies upside risk to the unemployment rate.”
While historically low at 4.1 percent in October, the unemployment rate has risen over the past year, up from 3.8 percent in October 2023, a sign that the labor market has softened. Federal Reserve officials cited labor market cooling as a factor behind their latest decision to lower interest rates, though they still described job conditions as “solid.” […]
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