US jobless claims hold at historically low level of 217,000

Applications for U.S. unemployment benefits held at historically low levels last week, the latest evidence of a resilient labor market.

Initial claims was unchanged at 217,000 in the week ending March 2, according to Labor Department data released Thursday. That was in line with the median estimate in a Bloomberg survey of economists.

In the decade before the pandemic, such claims averaged more than 300,000 a week.

Continuing claims, a proxy for the total number of people receiving unemployment benefits, ticked up to 1.91 million in the week ending Feb. 24.

While initial claims have remained subdued, recurring applications have been trending higher in the past six months, suggesting it may be taking longer for people who lost their jobs to find a new one. Looking ahead, economists expect the labor market to moderate in coming months as still-elevated prices and soaring borrowing costs take a toll on firms’ expansion plans.

Weekly claims tend to be choppy. The four-week moving average, which smooths out some of that volatility, was also little changed at 212,250 last week.

The unadjusted data on initial claims, which doesn’t take into account seasonal influences, rose to 213,152. New York accounted for the majority of the increase.

What Bloomberg Economics Says.

“To date, the labor market has cooled mainly through softer demand rather than broad-based layoffs,” said Bloomberg economist Eliza Winger. “We continue to expect the labor market to weaken in the next few months, with the unemployment rate increasing to 4.7% by year-end.”

-Eliza Winger, economist

U.S. companies announced some 84,600 job cuts in February, according to data out Thursday by executive coaching firm Challenger, Gray & Christmas. Although technology and financial companies are still the primary sectors shedding jobs, more industries are now trimming their workforce.

“Businesses are aggressively slashing costs and embracing technological innovations, actions that are significantly reshaping staffing needs,” Andrew Challenger, the firm’s senior vice president, said in the report.

The government’s monthly employment report due Friday is forecast to show a pullback in hiring and wage growth in February after both advanced significantly in the previous month. Economists expect US employers to have added 200,000 jobs last month.

US job openings remained elevated in January, though firms hired at a slower pace and employees grew more wary of quitting their jobs, according to data out Wednesday. A separate report showed private companies hired at moderate pace in February.

—With assistance from Chris Middleton.