WASHINGTON (Reuters) – The number of Americans filing new claims for unemployment benefits increased more than expected last week as labor market conditions gradually ease.
Initial claims for state unemployment benefits rose 9,000 to a seasonally adjusted 221,000 for the week ended March 30, the Labor Department said on Thursday. Economists polled by Reuters had forecast 214,000 claims in the latest week.
Claims had bounced around between 212,000 and 210,000 for much of March. There were 1.36 job openings for every unemployed person in February compared to 1.43 in January, government data showed this week.
Worker shortages persist in industries like construction.
Though layoffs increased to a 14-month high in March, job cuts were little changed compared to the same period last year.
Labor market resilience is anchoring the economy, with gross domestic product increasing at a brisk 3.4% annualized rate in the fourth quarter. Growth estimates for the first quarter are as high as a 2.8% pace. That strength, combined with still-high inflation, could see the Federal Reserve delaying a much anticipated interest rate cut this year.
Fed Chair Jerome Powell reiterated on Wednesday that the U.S. central bank has time to deliberate over its first rate cut, in a nod to the economy’s stamina and high inflation.
Since March 2022, the Fed has raised its policy rate by 525 basis points to the current 5.25%-5.50% range.
The number of people receiving benefits after an initial week of aid, a proxy for hiring, dropped 19,000 to 1.791 million during the week ending March 23, the claims report showed.
The claims data have no bearing on March’s employment report, scheduled to be released on Friday, as they fall outside the survey period. Nonfarm payrolls likely increased by 200,000 jobs in last month after rising by 275,000 in February, according to a Reuters survey.
The unemployment rate is forecast unchanged at 3.9%.
