WASHINGTON, Feb 2 (Reuters) – The number of Americans filing new claims for jobless benefits unexpectedly fell last week as the job market remained resilient despite rising borrowing costs and growing job fears. a recession.
Initial claims for state unemployment benefits fell by 3,000 to a seasonally adjusted 183,000 for the week ended Jan. 28, the Labor Department said Thursday. Economists polled by Reuters had forecast 200,000 claims for the past week.
Demands have been weak this year, consistent with a still-tight labor market, although the Federal Reserve’s fastest interest-rate hike cycle since the 1980s has heightened the risk of a recession. by the second semester.
The government announced on Wednesday that there were 11 million job vacancies at the end of December, with 1.9 openings for every unemployed person.
Outside of the tech industry and interest rate-sensitive sectors like housing and finance, employers have been reluctant to lay off workers after struggling to find work during the pandemic, and also because they are optimistic that economic conditions will improve later this year.
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A report from the Institute for Supply Management released on Wednesday said manufacturers “indicate they will not significantly reduce their workforce as they are positive for the second half of the year.”
The U.S. central bank on Wednesday raised its key rate by 25 basis points to the range of 4.50% to 4.75% and promised “continued increases” in borrowing costs. Fed Chairman Jerome Powell told reporters that “the economy can return to 2% inflation without a really significant slowdown or a very large increase in unemployment.”
The claims report showed the number of people receiving benefits after a first week of help, a proxy for employment, fell by 11,000 to 1.655 million in the week ending January 21.
The claims data has no bearing on the January jobs report, due out on Friday, as it falls outside the survey period. Nonfarm payrolls likely increased by 185,000 jobs last month, according to a Reuters poll of economists. The economy created 223,000 jobs in December.
The wave of layoffs in the tech sector pushed up job cuts in January. A separate report released Thursday by global outplacement firm Challenger, Gray & Christmas showed that job cuts announced by US-based employers jumped 136% to 102,943. This is the total of January the highest since 2009.
“We are now on the other side of the hiring frenzy of the pandemic years,” said Andrew Challenger, senior vice president at Challenger, Gray & Christmas. “Companies are bracing for an economic downturn, cutting staff and slowing hiring.”
The tech sector accounted for 41% of job cuts, with 41,829 layoffs. Retailers announced 13,000 job cuts, while financial firms planned to lay off 10,603 workers.
Last month, employers announced plans to hire 32,764 workers, mostly in the entertainment/leisure sector, down 37% from December and 58% from a year ago.
Reporting by Lucia Mutikani; Editing by Paul Simao
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