The number of Americans applying for unemployment benefits last week jumped by the most in five months, but layoffs remain historically low as the labor market continues to be largely unaffected by the Federal Reserve's interest rate hikes.
Applications for jobless claims in the U.S. for the week ending March 4 rose by 21,000 to 211,000 from 190,000 the previous week, the Labor Department said Thursday. It’s the first time in eight weeks that claims came in above 200,000.
The four-week moving average of claims, which flattens out some of the weekly ups and downs, rose by 4,000 to 197,000, remaining below the 200,000 threshold for the seventh straight week.
Applications for unemployment benefits are considered a proxy for layoffs.
Last month the Fed raised its main lending rate by 25 basis points, the eighth straight rate hike in its year-long battle against stubborn inflation. The central bank’s benchmark rate is now in a range of 4.5% to 4.75%, its highest level in 15 years and some analysts are forecasting three or more increases that would push the lower end of that rate to 5.5%.
The Fed’s rate increases are meant to cool the economy, labor market and wages, thereby suppressing prices. But so far, none of those things have happened, at least not to the degree that the central bank had hoped.
Inflation remains more than double the Fed’s 2% target, and the economy is growing and adding jobs at a healthy clip.
Last month, the government reported that employers added a better-than-expected 517,000 jobs in January and that the unemployment rate dipped to 3.4%, the lowest level since 1969. Analysts expect Friday’s jobs report to show the U.S. economy added another 208,000 jobs in February.
Fed policymakers have forecast that the unemployment rate would rise to 4.6% by the end of this year, a sizable increase historically associated with recessions.
Though the U.S. labor market remains strong, layoffs have been mounting in the technology sector, where many companies overhired after a pandemic boom. IBM, Microsoft, Amazon, Salesforce, Facebook parent Meta, Twitter and DoorDash have all announced layoffs in recent months.
The real estate sector has also been battered by the Fed’s interest rate hikes. Higher mortgage rates — currently above 6% — have slowed home sales for 12 straight months. That’s almost in lockstep with the Fed’s rate hikes that began last March.
About 1.72 million people were receiving jobless aid the week that ended Feb. 25, an increase of 69,000 from the week before.
The Rev. Al Sharpton is set to lead a protest march on Wall Street to urge corporate America to resist the Trump administration’s campaign to roll back diversity, equity and inclusion initiatives. The New York civil rights leader will join clergy, labor and community leaders Thursday in a demonstration through Manhattan’s Financial District that’s timed with the anniversary of the Civil Rights-era March on Washington in 1963. Sharpton called DEI the “civil rights fight of our generation." He and other Black leaders have called for boycotting American retailers that scaled backed policies and programs aimed at bolstering diversity and reducing discrimination in their ranks.
President Donald Trump's administration last month awarded a $1.2 billion contract to build and operate what's expected to become the nation’s largest immigration detention complex to a tiny Virginia firm with no experience running correction facilities.
Chipmaker Nvidia is poised to release a quarterly report that could provide a better sense of whether the stock market has been riding an overhyped artificial intelligence bubble or is being propelled by a technological boom that’s still gathering momentum.
Cracker Barrel said late Tuesday it’s returning to its old logo after critics — including President Donald Trump — protested the company’s plan to modernize.
Low-value imports are losing their duty-free status in the U.S. this week as part of President Donald Trump's agenda for making the nation less dependent on foreign goods. A widely used customs exemption for international shipments worth $800 or less is set to end starting on Friday. Trump already ended the “de minimis” rule for inexpensive items sent from China and Hong Kong, but having to pay import taxes on small parcels from everywhere else likely will be a big change for some small businesses and online shoppers. Purchases that previously entered the U.S. without needing to clear customs will be subject to the origin country’s tariff rate, which can range from 10% to 50%.
Southwest Airlines will soon require plus-size travelers to pay for an extra seat in advance if they can't fit within the armrests of one seat. This change is part of several updates the airline is making. The new rule starts on Jan. 27, the same day Southwest begins assigning seats. Currently, plus-size passengers can pay for an extra seat in advance and later get a refund, or request a free extra seat at the airport. Under the new policy, refunds are still possible but not guaranteed. Southwest said in a statement it is updating policies to prepare for assigned seating next year.
Cracker Barrel is sticking with its new logo. For now. But the chain is also apologizing to fans who were angered when the change was announced last week.
Elon Musk on Monday targeted Apple and OpenAI in an antitrust lawsuit alleging that the iPhone maker and the ChatGPT maker are teaming up to thwart competition in artificial intelligence.
