A hiring sign is displayed at a restaurant in Prospect Heights, Ill., on April 4, 2023. The hot jobs market has been defying a weakening economy and confounding the Federal Reserve for months, but now shows signs of cooling. The latest set of employment data from the government shows that job openings fell in March to their lowest level since April 2021. Layoffs rose to 1.8 million, their highest level since December 2020. (AP Photo/Nam Y. Huh, File)
By Matt Ott
The number of Americans applying for unemployment benefits last week rose to its highest level since October 2021, but the labor market remains one of the healthiest parts of the U.S. economy.
The Labor Department reported Thursday that U.S. applications for jobless claims were 261,000 for the week ending June 3, an increase of 28,000 from the previous week's 233,000. Weekly jobless claims are considered representative of U.S. layoffs.
The four-week moving average of claims, which evens out some of the weekly variations, rose by 7,500 to 237,250.
Despite last week’s sharp increase in filings for unemployment aid, some analysts cautioned against concluding that layoffs are picking up across the economy. They noted that the weekly figures are prone to revision and that last week’s numbers might have been distorted by the three-day Memorial Day weekend.
“The latest reading reflects a holiday-shortened week (Memorial Day), which ought to raise suspicions that the big move was more noise than signal,” said Stephen Stanley, chief U.S. economist for Santander. “I am eager to see next week’s reading before I draw any conclusions.”
The U.S. economy has added jobs at a furious rate since the pandemic purge of more than 20 million jobs in the spring of 2020. Americans have enjoyed unusual job security, despite the Federal Reserve's aggressive campaign to cool the economy and labor market in its bid to stifle persistent, decades-high inflation.
In early May, the Fed raised its benchmark lending rate for the 10th time in a row. There have been scattered signs that the Fed’s actions are working, but broadly, the job market continues to favor workers.
U.S. employers added a robust 339,000 jobs last month, well above expectations. Last week’s report painted a mostly encouraging picture of the job market but there were some mixed messages. Notably, the unemployment rate rose to 3.7%, from a five-decade low of 3.4% in April, the highest unemployment rate since October.
In April, employers posted 10.1 million job openings, up from 9.7 million in March and the most since January. Economists had expected vacancies to slip below 9.5 million.
Those reports, along with the jobless claims numbers, could help sway Fed officials one way or the other with regard to its next rate hike move. Most economists are predicting that the Fed will pause its rate hikes at its meeting next week, though the strong labor market could convince the central bank to stay the course with another small quarter-point increase.
The U.S. economy grew at a lackluster 1.3% annual rate from January through March as businesses wary of an economic slowdown trimmed their inventories. That’s a slight upgrade from its initial growth estimate of 1.1%.
Though the labor market remains strong, there have been notable high-profile layoffs recently, mostly in the technology sector, where many companies now acknowledge overhiring during the pandemic. IBM, Microsoft, Salesforce, Twitter, Lyft, LinkedIn, Spotify and DoorDash have all announced layoffs in recent months. Amazon and Facebook parent Meta have each announced two sets of job cuts since November.
Outside the tech sector, McDonald’s, Morgan Stanley and 3M also recently announced layoffs.
Overall, 1.76 million people were collecting unemployment benefits the week that ended May 27, about 37,000 fewer than the previous week.
Decentralized talent network Braintrust recently closed an atypical equity deal that involved investors buying $100 million in Braintrust tokens, the company's cryptocurrency. Braintrust's talent network is built on blockchain technology, which the company says allows it to be owned and built by users, instead of a centrally-controlled corporation. Braintrust users can also earn tokens for their contributions to the network and its growth. Braintrust co-founder Adam Jackson joins Cheddar News' Closing Bell to discuss.
Blue Origin launched its third manned mission over the weekend with 'Good Morning America' host Michael Strahan and Laura Shepard Churchley, daughter of astronaut Alan Shepard on board, alongside several Blue Origin investors.
This comes after the spaceflight firm launched two successful missions to the edge of space earlier this year. How will these missions set up Blue Origin for success as it competes with SpaceX and other companies for space tourism domination and more? Joey Roulette, space reporter at The New York Times, joins Cheddar News' Closing Bell to discuss.
If there's any question about whether inflation is here to stay, today's November consumer price index data gives us an answer. This is the second month in a row we've seen a hot inflation reading — CPI last month rose to 6.8%, after jumping to 6.2% in October. Amid the holiday shopping season, what does this mean for consumers? And how will the Federal Reserve move forward after previously announcing it would speed up its asset taper timeline? Art Hogan, Chief Market Strategist at National Securities, joins Cheddar News' Closing Bell to discuss November's CPI jump, where consumers are hurting the most, what the Fed could do to help ease inflation, and more.
Editorial and stock photo provider Getty Images is gearing up to make its public debut via a SPAC merger with CC Neuberger Principal Holdings II bringing it to a $4.8 billion valuation. CEO Craig Peters joined Cheddar to break down the decision to go public and noted that the merger will help to pay down debt. "That's going to really enable a lot of additional free cash flow and financial flexibility into the business," he noted. "That's just going to allow us to just invest more aggressively into the business to accelerate what is already accelerating growth." Peters also discussed the legacy image platform's place going forward in the expanding world of digital assets like NFTs and the metaverse.
Ben Schiller, the managing editor for features and opinion at CoinDesk, breaks down how the year's top 10 crypto influencers were selected and what to expect from the blockchain ecosystem, especially the growth of NFTs, in 2022. "This whole crypto story has become not just a story about money or the future of money," he said. "It's also become a cultural story where it's getting into gaming, it's getting into artwork, into collectibles, and all kinds of cultural categories it wasn't in before." Schiller noted that he expects the U.S. and other world governments to establish crypto regulations in the coming year.
Ford said it will ramp up production for its Mustang Mach-E as demand for the electric vehicle surges. The automaker expects to sell upwards of 200,000 annually by 2023.
Mina Makar, senior vice president of respiratory and immunology, Astrazeneca, joined Cheddar to discuss the FDA's decision to give emergency use authorization to the pharma giant's COVID-19 antibody treatment called Evusheld for immunocompromised patients For about 2 percent of the U.S. Makar noted that the injection is supposed to provide antibody protection for those who can't generate their own adequate immune response via the vaccines for a minimum of six months, though long-term trials are underway.
The pandemic has forced corporate America to reshape itself to adapt, including onboarding doctors as chief medical officers to help maintain the health and safety of staff. Dr. Geeta Nayyar, chief medical officer at Salesforce, joined Cheddar to break down her role and how it has become relevant and necessary in the evolving workplace. "Every business today is now in the business of healthcare," she said. "It is a priority to empower employees to then serve your customers."
Sustainable consumer products maker Grove Collaborative is gearing up to launch an IPO via a SPAC merger with Richard Branson's Virgin Group Acquisition Corp II. Stuart Landesberg, CEO and co-founder of Grove Collaborative, talked to Cheddar's Kristen Scholer about going public through the merger and aligning with a partner he felt also prioritizes climate. "What this partnership will mean is that we're able to expand the assortment and innovations that we bring to market in products that work just as well as the conventionals and market leaders but have a significantly different environmental profile," Landesberg said.
