New applications for unemployment benefits jumped 18,000 in mid-December to 206,000, but the increase likely reflected quirks tied to temporary hiring during the holiday shopping season.
Even after last week’s increase, new jobless claims are still extremely low. Two weeks ago, they fell to the lowest level in 52 years. Businesses are trying to avoid layoffs due the a major labor shortage that’s made it hard to fill open jobs.
The number of people already collecting state jobless benefits, known as continuing claims, declined by 154,000 to 1.85 million, the Labor Department said Thursday. They have also fallen to a pandemic low and returned to pre-crisis levels.
Big picture: The number of people getting laid off and filing for unemployment benefits is extremely low and underscores a rapid recovery in the labor market and U.S. economy.
Most companies want to hire so they can keep up with strong demand for their goods and services. And many are offering higher wages and benefits to try to lure new workers.
Don’t be surprised if jobless claims shows big ups and downs, however, as has been the case since Thanksgiving. Companies add lots of temporary workers in the last few months of the year and then let them go after Christmas.
The government tries to adjust jobless claims for changes in seasonal employment patterns, but its process has been thrown off by the pandemic.
Market reaction: The Dow Jones Industrial Average
DJIA,
and S&P 500
SPX,
were set to open higher in Thursday trades.
