According to the latest jobless claims data for the week, the number of US citizens filing for unemployment benefits has reached a 1.5-year high! However, economists believe that this isn't an indication of an increase in layoffs. They also cited how the data regarding the weekly jobless claims tend to be very volatile.
The data from Labor Department revealed that the recent influx of applications is one of the highest in the last 1.5 - 2 years. The states of California and Ohio contributed to the bulk of these jobless claims, according to Labor Department.
However, one thing that tells us this data might not be accurate is the memorial day holiday. In general, jobless claims around public holidays are usually very volatile.
More Confirmation Is Needed
According to a senior economic advisor, the recent jump in jobless claims may be a sign of increased layoffs. However, the volatility of the data means that it will be soon to reach any conclusion.
In addition, the number of claims based on state also tells us that additional confirmation is needed to confirm a fundamental shift in the jobs market.
Overall, the initial jobless claims jumpered by 28,000 and touched 261,000 by the end of 3rd June. According to statistics, this increase in jobless claims was only last seen on October 2021.
The economists were only forecasting a final reading of 235,000, while the actual reading turned out to be 261,000.
If we look at unadjusted claims, it also jumped by 10,535 and reached 219,391 for the week. In the state of Ohio alone, the number of applications increased by 6345, while California witnessed an increase of 5173 applications.
After the weekly jobless claims data, the opening of the US stocks was a little bullish while the US Dollar was moving downwards against the basket of other currencies.
In addition, the unemployment rate also reached a 7-month high and was last seen at 3.7%. Earlier, unemployment in the USA was only 3.4% during April.