A help-wanted sign hangs in the front window of the Bar Harbor Tea Room, Saturday, June 11, 2022, in Bar Harbor, Maine. On Thursday, the Labor Department reports on the number of people who applied for unemployment benefits last week. (AP Photo/Robert F. Bukaty, File)
New claims for state unemployment benefits fell more than expected last week. The Labor Department reported that the number of claims dropped 15,000 to a seasonally adjusted 190,000.
The drop is a "frustrating reminder" for the Federal Reserve that the labor market remains tight despite its efforts to give employers some slack by slowing down the economy, wrote Matthew Martin, U.S. economist for Oxford Economics, in a daily research brief.
The four-week moving average for claims remains near historic lows at 206,000, which tracks with a five-decade low unemployment rate of 3.5 percent.
The numbers may also come as a surprise for those witnessing yet another round of layoffs from the tech sector. Microsoft this week announced plans to cut 10,000 positions, or roughly 5 percent of its workforce, and Amazon began laying off thousands of employees as part of a plan to eventually terminate 18,000 jobs.
What explains the disparity between tech and the rest of the job market?
Dan Ives, analyst for Wedbush Securities, wrote that Microsoft in recent years "needed to aggressively hire along with the rest of the tech sector and spend money like 1980's Rock Stars to keep pace with eye-popping demand."
In his view, this was a classic case of overkill, and now workers are paying the price.
"We are seeing the clock strike midnight for the tech sector after a decade of hyper growth and now major layoffs are being seen at MSFT, Salesforce, Meta, Amazon, among many others across the Valley," he wrote.
Ives called this the "rip the band-aid off moment" for tech.
Not all tech companies are putting employees on the chopping block though. Apple, for example, has not yet announced a major round of layoffs, and it's faced many of the same challenges as the rest of the industry in the wake of the pandemic. One notable difference is that it didn't hire as many people during the pandemic.
Another outlier is Uber. CEO Dara Khosrowshahi said during an event at the annual gathering of the World Economic Forum in Davos, Switzerland, that the ridesharing giant is not considering layoffs at this time.
He noted that the company has tried to make cuts in other areas.
Nvidia on Wednesday became the first public company to reach a market capitalization of $5 trillion. The ravenous appetite for the Silicon Valley company’s chips is the main reason that the company’s stock price has increased so rapidly since early 2023.
Chris Williamson, Chief Business Economist at S&P Global, breaks down September’s CPI print and inflation trends, explaining what it means for markets.
A big-screen adaptation of the anime “Chainsaw Man” has topped the North American box office, beating a Springsteen biopic and “Black Phone 2.” The movie earned $17.25 million in the U.S. and Canada this weekend. “Black Phone 2” fell to second place with $13 million. Two new releases, the rom-com “Regretting You” and “Springsteen — Deliver Me From Nowhere,” earned $12.85 million and $9.1 million, respectively. “Chainsaw Man – The Movie: Reze Arc” is based on the manga series about a demon hunter. It's another win for Sony-owned Crunchyroll, which also released a “Demon Slayer” film last month that debuted to a record $70 million.
The Federal Aviation Administration says flights departing for Los Angeles International Airport were halted briefly due to a staffing shortage at a Southern California air traffic facility. The FAA issued a temporary ground stop at one of the world’s busiest airports on Sunday morning soon after U.S. Transportation Secretary Sean Duffy predicted that travelers would see more flights delayed as the nation’s air traffic controllers work without pay during the federal government shutdown. The hold on planes taking off for LAX lasted an hour and 45 minutes and didn't appear to cause continued problems. The FAA said staffing shortages also delayed planes headed to Washington, Chicago and Newark, New Jersey on Sunday.
Boeing workers at three Midwest plants where military aircraft and weapons are developed have voted to reject the company’s latest contract offer and to continue a strike that started almost three months ago. The strike by about 3,200 machinists at the plants in the Missouri cities of St. Louis and St. Charles, and in Mascoutah, Illinois, is smaller in scale than a walkout last year by 33,000 Boeing workers who assemble commercial jetliners. The president of the International Association of Machinists says Sunday's outcome shows Boeing hasn't adequately addressed wages and retirement benefits. Boeing says Sunday's vote was close with 51% of union members opposing the revised offer.
