The latest report from the U.S. Labor Department indicates a slight drop in new jobless claims, although the numbers remain high, suggesting a slowdown in the labor market.
Jobless claims statistics
The Labor Department reported that initial applications for unemployment benefits fell by 5,000 to 245,000 for the week ending June 14. This figure matched economists' predictions but remains close to the highest level in eight months. Continuing claims, which represent the number of people still receiving benefits, decreased by just 6,000 to 1.945 million.
Economic implications
The data was released on the same day that Federal Reserve officials concluded their two-day meeting, deciding to hold interest rates in the range of 4.25% to 4.50%, where they have been since December. This decision comes amid rising layoffs across various sectors, including transportation, construction, and healthcare.
Overall labor market trends
According to data from the Census Bureau, building permits for future single-family home construction fell by 2.7% in May to an annual rate of 898,000 units, the lowest since April 2023. High mortgage rates are keeping buyers out of the market, resulting in increased inventory levels last seen in late 2007. Anticipated upcoming data will provide insights into how quickly recently unemployed workers are finding new jobs.
The state of the labor market in the U.S. continues to show signs of slowing down, despite a slight decrease in new jobless claims. Expected data on continuing claims and hiring levels will help provide a clearer picture of current trends.