The number of Americans filing new jobless claims increased last week for the first time in more than a month, but layoffs are declining as the economy reopens and a shortage of people willing to work.
Other data showed Thursday that factory activity in the Mid-Atlantic region continued to grow steadily in June, and a measure of future production soared to its highest level in nearly 30 years.
Factories in the region encompassing eastern Pennsylvania, southern New Jersey and Delaware also reported an increase in hiring, which bodes well for job growth this month.
However, labor shortages are an obstacle to faster job growth.
The Federal Reserve on Wednesday kept its short-term benchmark interest rate near zero and said it would continue to pump money into the economy through monthly bond purchases.
Even so, the US central bank advanced its forecasts for the first increases in the cost of credit after the pandemic to 2023 from 2024.
“We continue to see progress in the labor market, but as has happened during the pandemic, the situation remains uncertain,” said AnnElizabeth Konkel, an economist at Indeed Hiring Lab. “We are at a very different point than we were in June 2020, but we have not yet crossed the finish line. “
Listens
Initial claims for jobless benefits rose 37,000 to a seasonally adjusted total of 412,000 in the week ended June 12, the Labor Department said Thursday.
This is the first increase since the end of April. Economists polled by Reuters had forecast 359,000 requests for the past week.
The economy is ironically facing a labor shortage, even though employment remains 7.6 million jobs below its February 2020 peak. The childcare shortage supports some parents, mostly women , at home.
Generous government-funded unemployment benefits, which include a weekly check of $ 300, have also been blamed, as has the reluctance of some to return to work for fear of contracting COVID-19, despite the fact that the vaccines are available.
Fed Chairman Jerome Powell told reporters on Wednesday that he was “sure we are on a path to a very strong job market, a job market that shows low unemployment, high turnout, rising wages for people. across the spectrum. “
Conditions for companies
In another report on Thursday, the Philadelphia Federal Reserve said its business conditions index fell to 30.7 this month from May 31.5. However, its measure for activity in the next six months rose to 69.2, the highest figure in nearly 30 years, from 52.7 last month.
The Mid-Atlantic region’s factory employment survey indicator rose to 30.7 from May 19.3. Factories also plan to hire more workers in the next six months, providing additional support to the labor market.
Although layoffs are declining, initial applications are still well above the 200,000 to 250,000 band that is considered consistent with a healthy job market. However, applications have fallen from the record 6.149 million in early April 2020.
