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Unemployment claims hit 10-month high as US labor market remains tight

Unemployment Benefits
Posted at 9:58 PM, Dec 08, 2022
and last updated 2022-12-08 23:56:18-05

Data out from the U.S. Department of Labor (DOL) on Thursday revealed that continued unemployment insurance claims rose to a 10-month high by late November showing the country's labor market is still tight.

The DOL data released went up until the week ending on Dec. 3 and showed that seasonally adjusted initial claims were at 230,000, a jump of 4,000 compared to the previous week.

States with the highest insured unemployment claims for the week ending on Nov. 19 were Alaska, New Jersey, California, Montana, New York, Massachusetts, Minnesota, Rhode Island, Nevada and Oregon; this also include the territory of Puerto Rico.

Isfar Munir, an economist at Citigroup in New York told Reuters, "It is too early to interpret higher continuing claims as a signal of a loosening labor market."

"The holiday time is generally not attractive to workers to start a new job, compounded by many firms temporarily closing during the holiday period," Munir said.

Resilient consumer spending, which is partly tied to strong employment, has made the fight against inflation more difficult. It has been keeping the economy strong enough to stay out of a recession, analysts have said, but it is also increasing the chances that the Fed will go too far in raising interest rates.

The Fed could potentially cause a recession by hitting the brakes too hard on the economy, the Associated Press reported.