US jobless claims fell by 19,000 to 241,000 in the week ending October 12, reflecting the economy’s recovery from disruptions caused by hurricanes in the Southeast. The previous week saw claims surge due to Hurricane Helene, which caused significant layoffs across impacted states.
This week’s figure, while still elevated compared to historical averages, suggests that temporary factors like weather events were driving last week’s spike.
Boeing strike continues to affect the US labor market
Despite the decline in overall claims, a strike by 33,000 Boeing machinists remains a persistent issue for the labour market. The strike, which entered its fifth week, has heavily impacted Boeing’s supply chain and operations.
Filings from workers affected by the strike are expected to continue influencing unemployment data, contributing to some volatility in upcoming weeks.
Hurricane Helene’s impact on jobless claims has receded, with fewer filings from affected states. The storm left behind lasting damage, particularly in the Southeast’s agricultural and manufacturing sectors.
This decline in claims indicates recovery efforts are underway, but some experts caution that high interest rates and inflationary pressures could further strain the labour market in the coming months.
Ongoing concerns about high interest rates
Beyond weather-related disruptions, recent data has raised concerns that the Federal Reserve’s aggressive interest rate hikes are beginning to weigh on the broader labour market.
Although jobless claims remain below recessionary levels, economists worry that persistent high rates may gradually erode labour demand, especially in interest-sensitive sectors like construction and manufacturing.
Along with new claims, the number of people continuing to receive unemployment benefits increased by 9,000 to reach 1.87 million for the week of October 5.
This marks the highest level since late July and further signals that while the job market remains resilient, challenges such as high interest rates, ongoing labour strikes, and weather-related disruptions are beginning to take a toll.
While the latest jobless claims report brings some relief after last week’s sharp rise, the broader economic picture remains mixed. The Federal Reserve has indicated it may keep interest rates higher for longer, a move that could lead to softer labour market conditions in the future.
With ongoing issues like the Boeing strike and global economic uncertainties, economists are cautiously optimistic about a potential slowdown in job creation towards the end of 2024.
The post US jobless claims fall as hurricanes subside, but Boeing strike adds pressure on labor market appeared first on Invezz
