U.S. jobless claims slightly drop last week, hovering around nine-month high

WASHINGTON, Aug. 18 (Xinhua) -- Initial jobless claims in the United States last week dropped slightly to 250,000, hovering around nine-month high as the labor market shows signs of cooling, the U.S. Labor Department reported on Thursday.

In the week ending Aug. 13, the number of Americans filing for unemployment benefits decreased by 2,000 from the previous week's downwardly revised level of 252,000, according to a report released by the department's Bureau of Labor Statistics.

The four-week moving average for initial jobless claims, a method to iron out data volatility, decreased by 2,750 to 246,750, the report showed.

The latest figure of 250,000 is well above the 2019 weekly average of 218,000, which is the pre-pandemic level. In the week ending March 14, 2020, jobless claims totaled 221,000, but in the following week, the figure skyrocketed to 2.9 million.

Jobless claims totaled 166,000 in the week ending March 19 this year, the lowest in decades. In recent months, the figures have been trending up amid surging inflation and rising interest rates.

The latest report also showed that the number of people continuing to collect regular state unemployment benefits, which was reported with a one-week lag, increased by 7,000 to 1.4 million during the week ending Aug. 6.

The total number of people claiming benefits in all programs -- state and federal combined -- for the week ending July 30 also increased by 2,696 to 1.48 million.

The Labor Department reported earlier this month that U.S. employers added 528,000 jobs in July despite recession fears, with the unemployment rate edging down to the pre-pandemic level of 3.5 percent, signaling a still robust labor market.

But as the Federal Reserve ramps up its fight against surging inflation, the strong job market may be about to take a turn for the worse.

Many participants noted that there were some "tentative signs of a softening outlook for the labor market," according to the minutes of the Federal Reserve's latest policy meeting released Wednesday.

These signs included increases in weekly initial unemployment insurance claims, reductions in quit rates and vacancies, slower growth in payrolls than earlier in the year, and reports of cutbacks in hiring in some sectors, showed the minutes of the Federal Open Market Committee's July 26-27 meeting.

Several participants observed that the moderation in labor market conditions might well lag the slowdown in economic activity, the minutes showed.

Participants remarked that a moderation in labor market conditions would likely involve a decline in the number of job openings as well as a moderate increase in unemployment from the current very low rate, it added.