(ConservativeFreePress.com) – Last week, unemployment claims reached a four-week high climbing by 8,000 to 229,000 first-time applications for jobless aid. This is important data ahead of the release of the May jobs report, as the Federal Reserve is considering whether it can start cutting interest rates in 2024.
On Thursday, the Labor Department reported on the week ending on June 1, while also revising the claims for the previous week up by 2,000 bringing it to 221,000.
Since January 2022, unemployment has continued to be below four percent with the job market showing that it is strengthening. However, the Federal Reserve has continued to tighten its monetary policy.
The stress is slowly starting to affect the labor market, where the numbers have appeared to slow down and the unemployment rate has increased in April 2024 to 3.9 percent from 3.4 percent a year earlier.
Within that same month, there were also 175,000 jobs that were added, a large decrease when compared to the 315,000 added in March and the 236,000 added in February.
In April, job openings dropped to the lowest level they have been since February 2021, with only 8.1 million open jobs. Still, for job seekers, the numbers are still in their favor with the ratio of vacant positions to job seekers being at 1.25. In recent years that ratio had often been significantly more favorable as it had almost reached a 2-to-1 level.
Since March 2022, the Federal Reserve has increased the interest rates eleven times, bringing the rate up to 5.33 percent. This effective rate has remained in place for close to a year.
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