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Unemployment claims rise to highest level in 8 months, signaling slowdown
The latest jobless claims data from the Labor Department has revealed a staggering increase in unemployment, with initial claims for U.S. benefits rising to their highest level in eight months. The significant uptick suggests that the labor market may be losing steam amid growing concerns over tariffs and economic uncertainty.
According to the data, new applications for jobless benefits jumped by 8,000 to 247,000 in the week ending May 31, exceeding economists’ predictions of 235,000 claims. While overall unemployment filings remain at historic lows, the increase is “hard to dismiss,” noted Oliver Allen, senior U.S. economist at Pantheon Macroeconomics.
Furthermore, jobless claims have been steadily floating between 200,000 and 250,000 since the COVID-19 pandemic in 2020 severely impacted the labor market. This recent surge may indicate a shift in the workforce ahead of the May jobs report release tomorrow.
Notably, the uptick in initial jobless claims could be an early warning sign for broader shifts within the job market. Additionally, we see a rise in newly unemployed workers struggling to find new employment rapidly, which can be attributed to factors such as tariffs, funding cuts, and overall economic pessimism putting pressure on companies’ workforces.
In light of these trends, many corporations have reduced their sales and profit expectations for 2025 within their recent quarterly earnings statements. Consumer confidence remains shaky despite some signs of relief.
Source: www.cbsnews.com
