This is not good folks.
Jobless claims unexpectedly increased to 248,000 last week, surpassing forecasts by analysts.
Despite an increase in demand for workers and easing Omicron cases, jobless claims reached 248,000 for the week ended Feb. 12, rising for the first time in a month. Refinitiv analysts forecasted the figure to be 219,000.
The number of Americans with continuing claims declined by 26,000 from a week earlier, putting the number of Americans who consecutively file unemployment claims at 1.59 million for the week ending Feb. 12.
However, Robert Frick, corporate economist at Navy Federal Credit Union, said the data was “probably noise” considering other employment data. Mentioning a potential “noise factor,” Frick pointed to layoffs increasing in a handful of states but emphasized to “expect claims to follow the trend of dropping along with omicron cases in the coming weeks.”
The report also shows that nearly 2 million Americans collected jobless benefits in the week ending Jan. 29, a nominal decrease from the week earlier. But the figure represents a substantial decrease from the 18.9 million claims in the same period last year.
Despite the increase in unemployment claims, businesses are struggling to keep up with consumer demand as more people venture out to shop, eat, and travel, with many businesses prioritizing efforts to hold on to their existing workers.
Labor Department data from earlier in the month showed businesses had hired more than 467,000 new workers in January, a shocking gain considering many states were experiencing a surge in Covid-19 cases.
A government report showing there were 10.9 million job openings in December and 4.3 million Americans quitting their job in the same month points to newly empowered workers leveraging business’s demand for workers to seek better wages, working conditions, and hours.
Yet, the pay raises for these employees has likely been eroded by the highest inflation in four decades.