Latest weekly jobless claims jump to 240,000


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CNN Business

Weekly unemployment claims for the first time jumped to 240,000 in the week ended Nov. 19, according to Labor Department data released Wednesday. This is a sharp increase of 17,000 from the previous week’s upwardly revised 222,000, and exceeds economists’ expectations for 225,000.

That’s the highest weekly total since Aug. 13, according to Labor Department data.

Continuous claims, which count people who have filed for unemployment benefits for at least two consecutive weeks, rose to 1.55 million in the week ended Nov. 12, the highest in eight months.

Jobless claims have been near historic lows as the labor market remains significantly tight, even as workers flocked back after the end of the pandemic-era lockdown.

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But that could be about to change — and in a nutshell: Big companies, especially some of the biggest names in tech, have started making massive layoffs.

Those layoffs aren’t necessarily reflected in last week’s claims, however, because many tech workers are being paid severance payments, said Eugenio Alemán, chief economist at Raymond James. Alemán said he was looking for signs of a broad increase in claims in other industries where workers are absent usually covered by severance pay.
“And it’s still not happening today,” he said.

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Weekly unemployment claims Economists at Oxford Economics write in their note on Wednesday, especially during the holiday season, which is often revised.

“Therefore, we do not think too much of a larger-than-expected decline in claims,” ​​they wrote.

Weekly initial jobless claims have averaged less than 215,000 this year. And while last week’s 240,000 claims is an increase from that average, it’s still below the 250,000 weekly claims consistent with a good economy and well below the 300,000-plus consistent with a recession, wrote Mark Zandi, Moody’s head of analytics an economist. via email to CNN Business.

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“I look at the rise in layoffs from a ‘bad news is good news’ lens,” he wrote. “That said, layoffs are terrible for those who lose their jobs, but it means the labor market is cooling, which is critical to bringing inflation back down and preventing the Federal Reserve from raising interest rates more aggressively.”

Zandi said he expects more layoffs heading into the new year “as big companies start cutting wages in a number of industries.”

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