Weekly U.S. jobless claims are up slightly, according to Haver Analytics estimates
Initial claims for unemployment benefits rose to a seasonally adjusted 229,140 in the week ended Nov. 1 from 219,520 in the previous week, Haver Analytics calculated. The figure matched estimates from Citigroup, JPMorgan and Nationwide.
The federal government shutdown, now the longest in history, has halted the collection, processing and publication of official economic data.
Claims data were not available for New Mexico and assumptions were made in accordance with what the Department of Labor would normally do when data are not available. The claims data could reassure concerns raised by private reports on Thursday that showed job losses in October and a sharp increase in announced layoffs due to cost-cutting and the adoption of artificial intelligence by businesses.
“The claims data contrasts sharply with this morning’s sharply negative Challenger job cuts report and shows that the labor market is not falling off a cliff,” said Oren Klachkin, financial market economist at Nationwide. “It is encouraging to see that the labor market remains stable, albeit soft, in the opening month of the fourth quarter.”
With the government shutdown, the closely watched Labor Department employment report will not be released on Friday for an unprecedented two consecutive months. However, states continue to collect weekly jobless claims data and submit it to the Department of Labor. Haver analysts and Wall Street economists take the data and apply seasonal adjustment factors previously released by the government to produce weekly damage estimates. ECONOMIC UNCERTAINTY HURTS THE LABOR MARKET
Economists cautioned against placing too much emphasis on some private-sector surveys, noting the limited scope of coverage and history. An analysis of domestic deposit data by the Bank of America Institute on Thursday suggested “no further slowdown yet” in the pace of job growth that “has been happening since the summer.”
The labor market has slowed considerably since the start of this year, and economists blame economic uncertainty, import tariffs and artificial intelligence for low demand for workers. The sharp reduction in labor supply due to raids on undocumented immigrants is also hurting hiring, most evident in small business surveys.
A survey Thursday by the National Federation of Independent Business showed that the share of small businesses citing quality of work as their single most important issue jumped to a four-year high in October.
Stable conditions in the labor market could allow the Federal Reserve to leave interest rates unchanged next month. The U.S. Federal Reserve last week cut its key overnight interest rate by another 25 basis points to a range of 3.75%-4.00%, and Fed Chairman Jerome Powell said that “another rate cut at the December meeting is not a foregone conclusion.
The number of people receiving jobless benefits after the first week of support, a gauge of hiring, rose to a seasonally adjusted 1,962 million in the week ended Oct. 25 from 1,955 million, JPMorgan estimated. This was roughly in line with calculations by Citigroup and Haver Analytics.
“This likely reflects hiring that remains sluggish and suggests a downside risk for employment data in October,” said Gisela Young, an economist at Citigroup.
The Chicago Fed earlier estimated the jobless rate rose to 4.36% in October — a four-year high of 4.4% on a rounded basis usually reported by the Bureau of Labor Statistics — from 4.35% in September.