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Jobless claims for the week ended June 21 dropped 10,000 to
236,000, a historically-low level. The four-week average of
claims, which smooths out weekly volatility, dipped 750 to
245,000.
Applications for unemployment aid are a proxy for layoffs, and
so the decline is evidence that businesses are mostly holding
onto their employees. Yet separate data suggests hiring also
remains cool, in what economists are referring to as a “no hire,
no fire” job market.
The unemployment rate remains low, though there are signs that
the economy is slowing. So far this year, employers have added a
solid but unspectacular 124,000 jobs a month, down from an
average 168,000 last year. Most of the hiring has been
concentrated in a few industries, specifically health care,
restaurants and hotels, and government. Layoffs have mostly
remained low, but hiring has also been weak.
Yet for many job-seekers, the sluggish creation of new jobs has
been a challenge. Recent college graduates are facing the
toughest job market in more than a decade. The unemployment rate
for grads aged 22 to 27 is now higher than the overall jobless
rate, and the gap between the two is the widest it has been in
more than 30 years.
The difficulty many of the unemployed are having in finding work
can be seen in the number of people continuing to claim
unemployment aid, which rose 37,000 to 1.97 million for the week
ending June 14. That is the most since November 2021.
Separately, the economy shrank 0.5% at an annual rate in the
first three months of the year, the Commerce Department said
Thursday, a worse showing than its previous estimate of a 0.2%
decline. A flood of imports swamped the economy as companies
rushed to bring in foreign goods before the Trump
administration's tariffs took effect.
A category within the GDP data that measures the economy’s
underlying strength rose at a 1.9% annual rate from January
through March, down from 2.9% in the fourth quarter of 2024.
This category includes consumer spending and private investment
but excludes volatile items like exports, inventories and
government spending.
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