Fewer Americans applied for unemployment benefits last week

• Fewer Americans applied for unemployment benefits the last week of August 2022.
• Jobless claims for the week ending August 27 fell by 5,000 to 232,000.
• Currently, 1.44 million Americans collect unemployment benefits.

Fewer Americans filed for unemployment benefits in the last week of August 2022 as the labor market continues to strengthen despite weakening elements of the US economy, reported The Associated Press.

Jobless claims for the week ending August 27 fell by 5,000 to 232,000, the Labor Department reported Thursday. The four-week average for claims, which offsets some of the week-to-week volatility, decreased by 4,000 to 241,500.

Fewer unemployment claims in August

The number of Americans collecting traditional unemployment benefits rose by 26,000 in the week ending Aug. 20, to 1.44 million. First-time applications generally reflect layoffs and are often seen as an early indicator of where the labor market is headed.

US hiring in 2022 has been remarkably strong even as the country grapples with rising interest rates and weak economic growth. On Tuesday, August 30, the government reported that the number of open jobs in the United States rose in July after three months of declines.

Hundreds of thousands of jobs expected to be added

There were 11.2 million job openings available on the last day of July, nearly two jobs, on average, for every unemployed person, a sign that employers are still urgently looking for workers despite the weakening economy and high inflation.

The Labor Department issues its August jobs report on Friday, and analysts polled by data provider FactSet expect the US economy to add a solid 300,000 jobs. US employers added 528,000 jobs in July, according to the Labor Department, more than double what forecasters expected. The unemployment rate fell to 3.5%, matching a 50-year low reached just before the coronavirus pandemic hit the US economy in early 2020. Filed Under: Unemployment Aid August

Bad news about unemployment

Inflation remains the biggest threat to the world and US economies. Consumer price growth slowed modestly from June to July, but remains historically high enough that the Federal Reserve has indicated it will continue to raise interest rates until prices recede.

The Federal Reserve has raised its benchmark short-term interest rate four times this year, and Chairman Jerome Powell said last week that the central bank will likely need to keep interest rates high enough to slow the economy «for some time» to control the worst inflation in 40 years, reported the AP. Powell has acknowledged that the increases will hurt U.S. households and businesses but he also said the pain would be worse if inflation was allowed to worsen. Filed Under: Unemployment Aid August

Some companies cut jobs

Although the labor market remains historically strong, some of that pain has already begun, particularly in the housing and technology sectors. Online real estate companies RedFin and Compass have recently announced job cuts as rising interest rates have cooled the red-hot real estate market.

There has also been a pushback in the tech sector after a nearly two-year pandemic boom. Snap, which owns the social media platform Snapchat, said on Wednesday that it was cutting 20% ​​of its global workforce due to declining revenue. PVH, the owner of Calvin Klein and Tommy Hilfiger, also announced Wednesday a 10% cut in «headcount costs» by the end of 2023. Netflix, Carvana and Tesla have also announced layoffs in recent months. Filed Under: Unemployment Aid August