The number of Americans filing new applications for jobless benefits dipped to the lowest in a month, indicating a still-healthy U.S. labor market that is unlikely to prompt further interest rate cuts from the Federal Reserve in the near term. Initial claims for state unemployment benefits fell by 1,000 to a seasonally adjusted 219,000 for the week ended December 21, lower than the 224,000 claims forecast by economists polled by Reuters.
The level of new benefits claims was in line with its average over the last year, with little indication of moving higher as layoffs remain muted. Meanwhile, those who have lost work are finding it harder to find a new job and are remaining on benefits rolls for a longer stretch, pushing up the ranks of those collecting unemployment benefits for more than a week.
The number of people receiving benefits after an initial week of aid rose 46,000 to a seasonally adjusted 1.910 million, the highest since November 2021. The average duration of unemployment in November was 23.7 weeks, the longest since April 2022, but the level of continued claims is only about 100,000 higher than it was a year ago.
The data suggests the pace of hiring may have slowed in December, with a survey week for the December nonfarm payrolls report indicating a loss of 227,000 jobs, while Jefferies U.S. economist Thomas Simons forecasts 170,000 new jobs for the report.
The latest claims data is unlikely to influence Federal Reserve officials, who last week lowered interest rates for the third time since September but signaled they are likely to take a break from further reductions with risks between the job market and inflation seen as roughly in balance.
