Initial Jobless Claims Up 249,000 for Week Ending July 27, 2024

Washington, D.C., August 1, 2024--In the week ending July 27, the advance figure for seasonally adjusted initial claims was 249,000, an increase of 14,000 from the previous week's unrevised level of 235,000, according to the Department of Labor.

The advance seasonally adjusted insured unemployment rate was 1.2% for the week ending July 20, unchanged from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment was 1,877,000--an increase of 33,000 from the previous week's revised level and the highest level for insured unemployment since November 27, 2021, when it was 1,878,000.

Reuters notes the impact of recent weather events, in addition to other temporary issues.

"Claims have been on an upward trend since June, with part of the rise blamed on volatility related to temporary motor vehicle plant shutdowns for retooling and disruptions caused by Hurricane Beryl in Texas," it writes. 

"Though applications broke above the upper end of their 194,000-245,000 range for this year, layoffs remain generally low," it adds. "Government data on Tuesday showed the layoffs rate in June was the lowest in more than two years. The slowdown in the labor market is being driven by low hiring as the Federal Reserve's interest rate hikes in 2022 and 2023 dampen demand."

At the Federal Reserve's press conference on Wednesday, chair Jerome Powell said he no longer sees the labor market as a source of inflation risk, reports The Wall Street Journal.

“While layoffs remain low, hiring rates have also tumbled," it notes. "It is taking workers longer to find jobs, and the unemployed rate edged up to 4.1% in June from 3.7% at the beginning of the year. Pressed over whether officials were concerned that this might presage further labor-market weakness ahead, Powell said, 'We’re watching really carefully for that.'

"Wage growth is cooling after the reopening from the pandemic ignited a rehiring frenzy. Private-sector wage and salaries grew 0.8% in the second quarter, the Labor Department said Wednesday, the softest rise since 2020."