Initial jobless claims rose to their highest level in eight months as 251,000 Americans filed for unemployment benefits for the week that ended on July 16, according to federal government data.
The numbers released by the Labor Department show that the job market is beginning to cool after it hit record low levels of unemployment not seen in decades.
In November, 265,000 Americans put in applications for unemployment insurance. Since then, jobless claims have been on the decline.
Continuing claims filed for the week that ended on July 9 rose to 1.384 million – which is 51,000 more compared to the previous week and the highest since April 23.
Earlier this month, federal data showed that companies added 372,000 people to their payrolls in June, which surprised economists who anticipated that job growth would slow down given the current economic headwinds.
The government reported earlier in July that employers advertised fewer jobs in May amid signs that the economy is weakening. AFP via Getty Images
Despite the uptick in jobless claims, unemployment remains at low levels not seen in some 50 years.
The unemployment rate remained at 3.6% for the fourth straight month – matching the lowest rate that was reached before the coronavirus pandemic.
Since lockdowns were lifted in most of the country, US companies in several key sectors of the economy, such as hospitality and travel, have struggled to fill job vacancies.
Government stimulus during the pandemic, COVID-19 concerns, childcare and other factors have contributed to the current labor shortage.
Department of Labor data from June showed employers broadly had continued to raise wages and hire more workers than expected.
Labor force participation, however, shrank for the second time in three months, to 62.2%, showing no persistent improvement since the start of 2022.
