The numbers: Some 260,000 people applied for unemployment benefits at the end of July, keeping jobless claims near a nine-month high and signaling a softening in the U.S. labor market as the economy slows. initial jobless claims increased by 6,000 from a revised 254,000 in the prior week.
Economists polled by the Wall Street Journal forecast initial jobless claims to total 260,000 in the seven days ended July 30. New filings had fallen to as low as 166,000 in late March — the second-fewest on record — before moving higher over the past several months as the economy slowed. Some companies, mainly in technology, have also resorted to layoffs.
The four-week average of new jobless claims, which smooths out the temporary ups and downs, climbed to 254,750, the highest level since last November. The figures are seasonally adjusted. Big picture: The economy is slowing in response to rising interest rates. The Federal is jacking up the cost of borrowing to try to tame the biggest outbreak of U.S. inflation in almost 41 years. Higher rates typically discourage consumers and businesses from spending and investing. Many companies are still trying to hire, however, and their biggest labor problem is finding enough workers to fill open jobs. The strong jobs market is the economy’s biggest bulwark against recession. Key details: Most of the increase in raw or actual jobless claims was concentrated in Connecticut, where new filings jumped by more than 7,000. The state recently modernized its unemployment system as part of an effort to make it more efficient and to better detect fraud. Oklahoma was the only other state to post a sizable in …