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29 November 2023

US new jobless claims surge to 26-year high

Job seekers and recruiters mingle to network for job opportunities during a Pink Slip Party at The Crescent Hotel in Beverly Hills, California. The state of California was declared the worst credit risk of any state in nation after Standard & Poors cut its general obligation bonds in response to the record budget deficit (AFP)

By Reuters
The number of US workers filing new claims for unemployment benefits jumped to a 26-year high last week, according to government data on Thursday that pointed to a rapid deterioration in the economy.

In addition, the number of people staying on the benefit rolls hit a record high in the week ended Jan. 24, showing the weak labor market has yet to hit bottom. On Friday, the Labor Department will issue the employment report for January, and analysts are expecting a drop of 525,000 payroll jobs. 

The department said initial claims for state unemployment insurance benefits rose 35,000 to a seasonally adjusted 626,000 in the week ended January 31, the highest since the week ending October 30, 1982. The prior week's number was revised up to 591,000 from 588,000.

Analysts polled by Reuters had forecast 585,000 new claims.

The number of people staying on the benefits roll after drawing an initial week of aid surged by 20,000 to a record 4.788 million in the week ended January 24, the latest week for which the data is available, from 4.768 million the previous week.

The four-week moving average for new claims, considered to be a better gauge of underlying trends as it irons out week-to-week volatility,  rose to 582,250, the highest reading since the week ending December 4, 1982.