By Geoffrey Smith
Investing.com — The number of people claiming unemployment benefits for the first time rose to a 10-week high last week, a sign that the labor market may be losing its ability to defy gravity.
The Labor Department said initial jobless claims rose to 211,000 last week, from 190,000 the week before. Analysts had expected only a small uptick to 195,000.
The less volatile four-week average, arguably a better indicator of the trend, also rose to a six-week high of 197,000
At the same time, continuing jobless claims also surprised to the upside, rising to 1.718 million and matching a 14-month high.
Kathy Jones, chief fixed-income strategist at Charles Schwab, said via social media that the numbers were “small signs that the labor market may be softening.”
The figures are more consistent with the slowdown in hiring that analysts have been predicting for weeks as the economy adjusts to a year of interest rate rises from the Federal Reserve. They add weight to claims made by some that the exceptionally high job gains detailed in the first two labor market reports of the year are due largely to seasonal adjustment factors and other statistical oddities, rather than the unbridled strength of the labor market.
Even so, the weekly claims numbers are just one soft data point among several firmer ones. Earlier on Thursday, the Challenger Job Cuts survey, which analyses a cross-section of businesses across the U.S., reported a decline in job cuts last month, supporting anecdotal evidence of labor hoarding by companies in a market where there are still nearly two unfilled jobs for every unemployed person.
On Wednesday, meanwhile, ADP said private sector payrolls grew by 242,000 through the middle of last month, more than double its estimate for January.
The Labor Department will release the official employment data for March on Friday at 08:30 ET (13:30 GMT).