Jobless claims applications ticked up modestly last week, but the total number of Americans collecting unemployment benefits rose to their highest level in more than three years.
Applications for jobless benefits rose by 6,000 to 223,000 for the week ending January 18, the Labor Department said Thursday. Analysts were expecting 219,000 new applications.
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Weekly applications for jobless benefits are considered a proxy for layoffs.
The total number of Americans receiving unemployment benefits for the week of January 11 climbed by 46,000 to 1.9 million, the most since November of 2021.
The rising level of continuing claims, the total number of Americans collecting jobless benefits, suggests that some who are receiving benefits are finding it harder to land new jobs. That could mean that demand for workers is waning, even as the economy remains strong.
The four-week average of continuing claims is about 100,000 higher than it was a year ago.
Though some signs of labor market weakness surfaced in 2024, jobs are still plentiful and layoffs historically low.
Earlier this month, the Labor Department reported that job growth in December surged and unemployment fell. Employers added 256,000 jobs last month and the unemployment rate ticked down to 4.1%.
The final jobs report of 2024 underscores that the economy and hiring were able to grow at a solid pace even with interest rates much higher than they were before the pandemic. As a result, the Federal Reserve could be much less likely to cut borrowing costs again in the coming months after issuing three cuts late in 2024.
Overall, the solid jobs figures suggest the economy is entering a post-COVID period of steady growth, higher interest rates, low unemployment, and slightly elevated inflation.
Though layoffs remain healthy by historical standards, several high-profile companies have announced job cuts in the past few months.
Facebook parent company Meta announced earlier this month that it was laying off 5% of its staff and spirits giant Brown-Forman — the maker of Jack Daniel’s — said it’s reducing its global workforce by about 12%.
Late in 2024, GM, Boeing, Cargill and Stellantis all announced layoffs.