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The numbers: New filings for unemployment benefits rose by 11,000 to 227,000 in early March largely because of unusually big increases in New York and California. Yet businesses are trying to avoid layoffs as they confront an extremely tight labor market and try to fill a record number of open positions.
Initial jobless claims rose from a revised 216,000 in the prior week, the Labor Department said Thursday.
Economists polled by The Wall Street Journal had forecast initial jobless claims to total a seasonally adjusted 216,000 in the seven days ended March 5.
Aside from the big increases in New York and California, new filings were little changed in almost every other state.
Jobless claims still appear on track to fall near 200,000 again in the near future. They briefly fell to a 52-year low of 188,000 at the end of last year.
Big picture: The jobs market is red-hot.
Companies have more than 11 million open positions — two for every unemployed worker — but they are struggling to fill many of them. Most are offering higher pay and benefits to attract new employees.
The strong demand for labor also reflects strong demand for goods and services, suggesting the U.S. economic recovery is still in good shape.
Some headwinds are developing, however. The war in Ukraine and high inflation, abetted by rising oil prices, threatens to undermine growth. So does the prospect of the Federal Reserve increasing interest rates.
Key details: Raw or unadjusted jobless claims surged by 16,255 in New York and by 6,233 in California. Most other states showed little or no change and 25 reported declines.
The number of people already collecting unemployment benefits, meanwhile rose by 25,000 to 1.49 million in the week ended Feb. 26.
These so-called continuing claims, which are reported with a one-week lag, have returned to pre-crisis levels and are extremely low.
Looking ahead: “Demand for labor is strong and there are no reasons to believe that this will change any time soon, barring another wave of a new Covid variant,” said Thomas Simons, money market economist at Jefferies. “We expect that both initial and continuing claims will be biased toward heading lower in the weeks ahead.”
Market reaction: The Dow Jones Industrial Average
DJIA,
and S&P 500
SPX,
were set to open lower in Thursday trades. Stocks rose on Wednesday, but they have been under pressure since the Russian invasion of Ukraine.
