There is still no sign that high-profile layoffs, mostly in
the technology sector, have had a material impact on the labor
market, with economists and policymakers saying these companies
over-hired during the pandemic and were not representative of
the overall economy. Economists also speculate that severance
packages were keeping some laid off workers from filing claims.
"It is possible that initial claims might not be fully
capturing layoffs of higher-paid workers who might not qualify
for unemployment benefits based on severance or might not file
for benefits for some other reason," said Veronica Clark, an
economist at Citigroup in New York.
Economists also believed that seasonal adjustment factors,
the model the government uses to strip out seasonal fluctuations
from the data, were keeping claims lower. The seasonal
adjustment factors for 2023 will be updated at the end of March.
Labor market resilience and stubbornly high inflation have
increased the odds of the Fed raising interest rates at least
three more times this year instead of twice. The U.S. central
bank has hiked its policy rate by 450 basis points since last
March from near zero to a 4.50%-4.75% range, with the bulk of
the increases between May and December.
The number of people receiving benefits after an initial
week of aid fell 5,000 to 1.655 million during the week ending
Feb 18, the claims report also showed. The so-called continuing
claims, a proxy for hiring, covered the period during which the
government surveyed households for February's unemployment rate.
Continuing claims were little changed between the January
and February survey periods. The unemployment rate at 3.4% in
January was the lowest in more than 53 years. Economists expect
strong employment growth in February, though the pace probably
slowed from January's blockbuster 517,000 jobs.
(Reporting by Lucia Mutikani; Editing by Chizu Nomiyama)
WASHINGTON, March 2 (Reuters) - The number of Americans
filing new claims for unemployment fell again last week,
pointing to sustained labor market strength that could keep the
Federal Reserve raising interest rates.
Initial claims for state unemployment benefits dropped 2,000
to a seasonally adjusted 190,000 for the week ended Feb. 25, the
Labor Department said on Thursday. It was the seventh straight
week that claims remained below 200,000. Economists polled by
Reuters had forecast 195,000 claims for the latest week.
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.