Statistics show that the number of Americans reporting new jobless claims surprisingly increased last week, but labour market conditions remain unchanged, with robust demand for workers and widespread shortages. The number of claims had earlier lowered, however, the situation has reversed now.
The Labor Department reported on Thursday that initial claims for state jobless benefits jumped 1,000 to about 203,000 over the week that ended on May 7, which was the highest level since February. Reuters polled economists, who predicted 195,000 submissions for the most recent week.
Since reaching an over 53-year record low 166,000 in March, filings have generally remained flat. Economists attributed the second consecutive weekly rise to data volatility surrounding moveable holidays such as Easter, Passover, or school summer vacations.
On the March 31, 2022, there were an unprecedented 11.5 million employment opportunities, while nonfarm payrolls increased 428,000 in April, marking the 12th consecutive month of growth in greater of 400,000. Claims have decreased since peaking at 6.137 million during early April 2020.
The Federal Reserve hiked its interest rates by 0.5% in the last week, the largest increase in 22 years. Fed then said that it will begin selling bonds next month. The Federal Reserve of the United States, which began hiking interest rates in March, is attempting to rebalance labour demand and supply.
Wages are rising due to tight labour markets, which is trying to keep inflation at an unacceptably high level. However, there are indicators that inflation has likely risen, at least on a yearly basis.
On Thursday, the Labor Department’s other report mentioned that that the producer price index for final demand grew 0.5% last month as rise in the price of energy goods slowed. In March, the PPI increased by 1.6%. The PPI grew 11.0% in the year to April after increasing 11.5% in March.