US jobless claims fall to 187,000, lowest level since 1969

Jobless claims in the US fell to a new half-century low last week as employers held on to their workers amid a labor shortage.

Initial jobless claims, a proxy for layoffs, fell 28,000 to a seasonally adjusted 187,000 last week, the Labor Department said on Thursday. That was slightly lower than last December and the lowest level for initial claims in over 52 years since September 1969. The four-week moving average, which smooths out the volatility in the numbers, fell 11,500 to 211,750.

Rolling Claims, a measure of the total number of people out of work through regular government programs, fell to 1.35 million in the week ended March 12 from 1.42 million in the previous week. That was the lowest level since January 1970, when the labor force was about half what it is today. Ongoing claims are reported with a one week delay.

“It just reflects how tight labor markets are,” said Nancy Vanden Houten, senior US economist at Oxford Economics. “In an environment where employers struggle to hire and retain workers, layoffs are kept to a minimum.”

According to the Labor Department, around half a million fewer people were employed in February than before the pandemic, despite the rapid recovery in the economy. This has resulted in employers struggling to fill vacancies.

In January, the most recent month for which data are available, there were almost 11.3 million job vacancies, down slightly from December’s 11.4 million job vacancies.

In contrast, according to the ministry, there were only about 6.3 million unemployed in February.

The drop in new jobless claims comes at a time when the number of new coronavirus cases is declining, potentially freeing up more people to get back into the job market. According to census surveys, about 2.8 million people were not working because they either had or are caring for someone with Covid-19 in early March, up from 7.8 million in late January and early February. And the number of people not working because they were afraid of getting sick fell from 3 million to 2.3 million.

“It’s a very, very tight job market, tight at an unhealthy level I would say,” Federal Reserve Chair Jerome Powell said after the Fed’s March 15-16 meeting. March before reporters.

The Fed raised interest rates by a quarter of a percentage point at the meeting, to between 0.25% and 0.5%, and forecast to raise its benchmark rate to nearly 2% by the end of the year to cool inflation, which has been accelerating at the fastest pace since 40 years.

Mr Powell said he believed officials could raise interest rates while maintaining a vibrant labor market.

“We feel the economy can handle tighter monetary policy,” he said.

But a rapid rise in interest rates risks sending the economy into a downturn and hurting jobs, said Joshua Shapiro, chief US economist at MFR, Inc.

Fed officials “are beginning to realize what a hole they’ve dug for themselves and what a difficult balancing act it’s going to be to keep inflation down without breaking anything,” he said.

The monthly jobs report shows key indicators about the job market and the general economic situation, but it doesn’t show the whole picture. WSJ explains how to read the report, what it shows and what it doesn’t. Photo illustration: Liz Ornitz

write to David Harrison at david.harrison@wsj.com

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https://www.wsj.com/articles/weekly-jobless-claims-03-24-2022-11648126291?mod=pls_whats_news_us_business_f US jobless claims fall to 187,000, lowest level since 1969

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