WASHINGTON (AP) — The number of applications for unemployment benefits in the U.S. increased last week. Despite this rise, layoffs are still at historically healthy levels. The Labor Department announced that 209,000 individuals filed jobless claims, slightly higher than the previous week’s revised figure of 200,000. This number exceeded the 205,000 level that experts had anticipated.
The four-week average of jobless claims, which helps balance out weekly fluctuations, remained stable at 199,000. Moreover, the number of people collecting unemployment benefits decreased by 22,000 to a total of 1.78 million for the week ending August 1.
Jobless claims serve as an indicator of layoffs, and they’ve consistently hovered between 200,000 and 230,000 weekly over the past year. This suggests that employees currently hold significant job security. The U.S. unemployment rate stands at a low 4.1%, demonstrating economic resilience even as energy prices have surged due to conflicts involving Iran.
Carl Weinberg, chief economist at High Frequency Economics, commented on the situation, noting the absence of stress in the labor market despite the rise in oil prices linked to geopolitical tensions. “The labor market has yet to show any sign of wear and tear from the surge in oil prices since the start of the war with Iran,” he stated.
However, challenges remain for those seeking to enter the job market or for individuals striving to find new employment. Following the COVID-19 lockdowns in recent years, companies have become cautious. They are reluctant to let go of their workforce, yet they are also hesitant to hire new staff. This has led economists to dub the current situation as a “no hire, no fire” market.
In the previous month, various employers, including businesses, government, and nonprofits, reduced their workforce by 23,000 jobs, according to the Labor Department. This year, employers have averaged an addition of 61,000 jobs per month. While this figure is better than the 9,700 monthly average of the prior year, it’s still below the 166,000 monthly average created in 2023 and 2024. It also significantly trails the 491,000 jobs per month during the hiring surge following pandemic lockdowns in 2021-2022.