Unemployment Claims Surge to Record High Since September 2023 – One America News Network
OAN Staff James Meyers
9:48 AM – Thursday, July 18, 2024
A new report has revealed that the number of jobless claims has reached the highest in 10 months.
Advertisement
In a new report released by the Labor Department on Thursday, the number of new applications for unemployment benefits rose by 20,000 to 243,000 last week, making it the highest number of claims since September 2023.
The latest increase could point to a softening labor market due to high interest rates by the Federal Reserve.
“Jobless claims came in higher than expected and that’s a reminder of the main risk to the current economic expansion and bull market,” wrote Chris Zaccarelli, Chief Investment Officer for Independent Advisor Alliance.
Despite the latest numbers the amount of claims is considered highly volatile and susceptible to large movement.
“Recent data are indicative of a modest softening in the labor market, but there is no cause for alarm just yet,” wrote Moody’s Analytic Economist Dante DeAntonio. “Despite the recent volatility, the four-week moving average of initial claims was essentially unchanged from the June payroll reference period to that for July.”
If fewer people are claiming unemployment insurance, this could suggest that fewer people are getting laid off. So the increase could be alarming, since the numbers haven’t hit this high since last year.
“Net, the recession clouds have moved back in suddenly, literally, almost overnight, and the skies are darkening ominously with new job layoffs surging and the total number of jobless workers receiving unemployment benefits at a new 2024 high,” said Chris Rupkey, chief economist at FWDBONDS. “This is exactly what a recession looks like, and it will be a miracle if the economy misses one.”
Meanwhile, the Fed have raised its interest rate target from 5.25% to 5.50%.
From 2022 to 2023, the Fed has increased interest rates 11 times, bringing them from a historic low of 0.08% to the highest rate in over 20 years.
Now the question remains when will the Fed start cutting rates, with investors expecting the first rate cut after years of tightening to come at the Fed’s September meeting.
Most of the labor market’s recent slowdown has been indicated in businesses hiring employees, according to DeAntonio
“To the extent that the job market remains robust and unemployment levels remain low, the economy will continue to expand – albeit at a slowing pace – and that is what will continue to propel this bull market to new heights, even if there is some volatility and pullbacks along the way,” Zaccarelli wrote.
Stay informed! Receive breaking news blasts directly to your inbox for free. Subscribe here. https://www.oann.com/alerts
Advertisements below
