CONSUMER

Fewer Americans file for jobless claims as labor market continues to shrug off higher interest rates

Apr 11, 2024, 2:46 PM

A hiring sign is displayed at a restaurant in Buffalo Grove, Ill., Wednesday, May 10, 2023. On Wedn...

A hiring sign is displayed at a restaurant in Buffalo Grove, Ill., Wednesday, May 10, 2023. On Wednesday, the Labor Department reports on job openings and labor turnover for April. (AP Photo/Nam Y. Huh)
Credit: ASSOCIATED PRESS

(AP Photo/Nam Y. Huh)

WASHINGTON (AP) — Fewer Americans applied for jobless benefits last week as the labor market continues to thrive despite the Federal Reserve’s efforts to cool it.

The Labor Department reported Thursday that filings for unemployment claims for the week ending April 6 fell by 11,000 to 211,000 from the previous week’s 222,000.

The four-week average of claims, which smooths out some of the week-to-week swings, fell by 250 to 214,250.

Weekly unemployment claims are considered a proxy for the number of U.S. layoffs in a given week and a sign of where the job market is headed. They have remained at historically low levels since the pandemic purge of millions of jobs in the spring of 2020.

The Federal Reserve raised its benchmark borrowing rate 11 times beginning in March of 2022 in a bid to stifle the four-decade high inflation that took hold after the economy bounced back from the COVID-19 recession of 2020. Part of the Fed’s goal was to loosen the labor market and cool wage growth, which it believes contributed to persistently high inflation.

Many economists thought there was a chance the rapid rate hikes could tip the country into recession, but jobs have remained plentiful and the economy has held up better than expected thanks to strong consumer spending.

In March, U.S. employers added a surprising 303,000 jobs, yet another example of the U.S. economy’s resilience in the face of high interest rates. The unemployment rate dipped from 3.9% to 3.8% and has now remained below 4% for 26 straight months, the longest such streak since the 1960s.

Though layoffs remain at low levels, companies have been announcing more job cuts recently, mostly across technology and media. Google parent company Alphabet, Apple, eBay, TikTok, Snap, Amazon, Cisco Systems and the Los Angeles Times have all recently announced layoffs.

Outside of tech and media, UPS, Macy’s and Levi Strauss also have recently cut jobs.

In total, 1.82 million Americans were collecting jobless benefits during the week that ended March 30, an increase of 28,000 from the previous week and the most since January.

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Fewer Americans file for jobless claims as labor market continues to shrug off higher interest rates