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By Matthew Impelli
Life & Trends Reporter
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The number of Americans applying for jobless benefits continued falling this month, according to new data.
On Thursday, the U.S. Department of Labor released data showing the number of Americans applying for unemployment benefits last week dropped to 227,000, which was a decline of 7,000 compared to the previous week.
According to the data, 1.86 million Americans are collecting jobless benefits for the week ending on August 3. The Labor Department report also showed that the four-week average for unemployment claims decreased by 4,500 to 236,500.
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Unemployment benefit filings, often seen as an indicator of layoffs, have remained historically low, averaging 213,000 per week from January to May. However, claims began climbing in May and reached 250,000 by late July. This uptick adds to growing signs that high interest rates are beginning to impact the U.S. job market.
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Earlier this month, data from the U.S. Bureau of Labor Statistics (BLS) showed unemployment claims for the week ending on July 27 reaching 249,000, which was an increase of 14,000 from the previous week and the highest level over the past year.
In June, about 160,000 workers in the United States became unemployed, according to data from the U.S. Bureau of Labor Statistics. In June 2024, there were 6.8 million Americans who were unemployed, compared to 6.65 million in May who were not working, the government data showed. This unemployment data, however, differs from state to state.
However, recent data shows jobless claims declining over the past two weeks, alleviating some concerns about the current state of the U.S. economy.
Robert Frick, economist at the Navy Federal Credit Union, told the Associated Press (AP) that "claims calmed down and their recent rise appears to be just a blip, not a fundamental shift in the labor market."
In 2022 and 2023, the Federal Reserve raised its benchmark interest rate 11 times, reaching a 23-year high at one point. Inflation has steadily decreased, dropping from a peak of 9.1 percent in June 2022 to a three-year low of 2.9 percent last month. Despite rising borrowing costs, both the economy and job growth have remained resilient, defying predictions that the U.S. would fall into a recession.
"Fed officials need not worry themselves to death about the outlook because the downside risks to the economy are fading fast with fewer job layoffs and robust consumer spending," said Christopher Rupkey, chief economist at FWDBONDS, told Reuters. "The economy is not going off the rails."
In July, employers across the nation added 114,000 jobs, which is far below the average of almost 218,000 seen from January to June. The current unemployment rate sits at 4.3 percent, but the rate increased for the fourth consecutive month in July.
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