(Bloomberg) -- Applications for US unemployment benefits rose slightly to a level that is consistent with limited number of layoffs.
Initial claims increased by 6,000 to 225,000 in the week ended Sept. 28. The median forecast in a Bloomberg survey of economists called for 221,000 applications.
The four-week moving average of new applications, a metric that helps smooth out volatility, fell to 224,250, the lowest since June 1.
Continuing claims, a proxy for the number of people receiving benefits, were little changed at 1.83 million in the previous week, according to Labor Department data released Thursday.
Weekly filings for benefits have remained subdued even as hiring has slowed this year and joblessness has risen. This is largely because employers have mostly held on to their existing workers.
Before adjusting for seasonal factors, initial claims fell last week. Georgia and Florida saw the largest declines, and North Carolina, South Carolina and Tennessee had small decreases. Altogether, those states, which were affected by Hurricane Helene at the end of last week, saw claims drop by more than 3,000.
In absence of the storm, the national number might have been higher, according to Stephen Stanley, chief economist at Santander US Capital Markets LLC.
“This reflects the fact that labor offices in some locales were probably closed near the end of last week, and residents were otherwise occupied and thus less likely to take the time to file for unemployment benefits,” Stanley wrote in a note. “The hurricane effect will reverse going forward, as people thrown out of work by storm damage will likely push up the tally for a few weeks.”
The number of job cuts announced by US-based employers so far this year was little changed from a year earlier, according to outplacement firm Challenger, Gray & Christmas. A large percentage of the layoffs have come from the technology sector, which usually pays generous severance packages, Challenger said Thursday. That means those workers are less likely to seek unemployment insurance.
Still, some high-profile large corporations have announced plans to trim their workforce in recent weeks. They included health-care company CVS Health Corp., which plans to cut roughly 2,900 jobs.
In the coming weeks, a strike of dockworkers affecting US East and Gulf ports from Boston to Houston could add to claims volatility in industries associated with shipping. Bloomberg Economics estimates the work stoppage could lower October payrolls by 80,000 jobs if it lasts more than two weeks.
What Bloomberg Economics Says...
“Prolonged strikes may force suppliers to temporarily lay off non-striking workers, who are eligible for unemployment-insurance benefits. That would add to distortions and downside risks to the economy.”
—Eliza Winger
To read the note, see here.
Data on September employment will be published Friday. Economists anticipate another month of moderate payroll growth, with the unemployment rate seen unchanged at 4.2%.
(Adds economists’ comments)
©2024 Bloomberg L.P.