Applications for US state unemployment insurance rose by the most in nearly a year during the week that included the Memorial Day holiday.
Initial unemployment claims climbed broadly across states by 27,000 to 229,000 in the week ended June 4, Labor Department data showed Thursday. The figure topped all estimates in a Bloomberg survey of economists. On an unadjusted basis, claims rose by about 1,000.
Continuing claims for state benefits held at 1.3 million in the week ended May 28.
The jobless claims data, which can be choppy from week to week, tend to be especially volatile around holidays. The four-week moving average, which smooths out such swings, rose by 8,000 to 215,000. It’s been creeping higher.
“Claims data can be noisy around holidays,” said Nancy Vanden Houten, lead US economist at Oxford Economics. “However, while we think labor markets are still currently quite tight, we can’t totally dismiss the notion that the rise in claims is a sign of a modest rise in layoffs.”
While initial claims continue to hold near pre-pandemic levels, the marked jump in applications, if sustained, could signal a softening in the job market in the coming months. By increasing interest rates, the Federal Reserve is trying to cool demand broadly in the economy — including for labor — in an effort to curb decades-high inflation, which could increase unemployment.
The claims data follow last week’s jobs report, which showed US employers hired at a robust clip in May while wage gains held firm, suggesting the economy continues to power forward and that firms had success filling open positions.
Georgia, Florida and Pennsylvania posted the largest increases in unadjusted applications.
