The number of Americans filing new claims for unemployment benefits fell last week, but remained at levels that suggest labor market momentum was weakening in June.
Initial claims for state unemployment benefits fell by 5,000 to a seasonally adjusted 245,000 for the week ended June 14, the Labor Department said on Wednesday. Economists polled by Reuters had also expected a figure of 245,000 for the week.
The report came a day ahead of the Juneteenth holiday on Thursday.
The number of claims remained at the highest level of the year and is expected to remain so, as non-teaching workers in some states are eligible to apply for unemployment benefits during the summer school break.
While technical factors contributed to the increase in claims, there was also an increase in layoffs, and economists said President Donald Trump's sweeping tariff policies have created a challenging economic environment for companies. The claims data also includes the period during which the government conducted a survey of companies for the nonfarm payrolls component of the June jobs report.
Federal Reserve officials, who wrapped up a two-day policy meeting on Wednesday, are expected to keep the U.S. central bank’s benchmark interest rate between 4.25% and 4.50%, where it has been since December, while monitoring the economic impact of import tariffs and the conflict between Israel and Iran.
While layoffs remain at historically low levels, they have helped keep the labor market stable, even as hiring slowed as employers worried about economic uncertainty. Nonfarm payrolls rose by 139,000 jobs in May, down from 193,000 in the same period a year ago.
Next week’s data on the number of people receiving benefits after the first week of benefits, a proxy for the hiring rate, is expected to provide a clearer picture of labor market conditions in June.
Continuing claims, the number of people still receiving benefits, fell by 6,000 to a seasonally adjusted 1.945 million for the week ended June 7. Newly laid-off workers are reportedly facing difficulty finding new jobs.
