US jobless claims rise while hiring plans drop
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The news: US initial jobless claims rose 11,000 to 219,000 for the week ending 1 February, according to the Labor Department, exceeding forecasts of 213,000 from economists polled by Reuters.
The numbers: Continuing claims, a proxy for hiring, increased 36,000 to 1.89 million for the week ending 25 January.
Unadjusted claims were led by increases in California and New York, the data showed. The four-week moving average of new applications rose to 216,750.
Private employment data from ADP Research showed steady a hiring pace in January, while a separate report found labour productivity advanced in Q4.
According to outplacement firm Challenger, Gray & Christmas, US employers announced 6,089 planned hires in January, down 24% from December but up 13% from January 2024.
The firm also found job cuts totalled nearly 50,000 job cuts, the lowest January count since 2022.
The context: The labour market remains relatively stable but is showing signs of cooling. While slightly higher than expected, jobless claims remain relatively low despite layoffs, the California wildfires and Boeing job cuts.
Some high profile companies, including Workday, Salesforce, General Motors, and Estée Lauder, have already announced layoffs in February.
The numbers come ahead of the jobs report due Friday (Saturday AEDT) which is expected to show nonfarm payrolls likely increased by 170,000 jobs in January, according to a Reuters survey of economists. The unemployment rate is forecast to remain at 4.1%.
What they said: “January was relatively quiet in terms of job cut announcements. However, we’ve already seen major announcements in the early days of February, so it seems this quiet is unlikely to last,” Andrew Challenger, senior vice president of Challenger, Gray & Christmas, said in a statement.
The sources: Department of Labor, Bloomberg, Reuters
