New claims for unemployment benefits rose more than expected during the first week of January climbing by 24,000 to 399,000 for the week. Projections called for 375,000 new applications.
While the surge makes it clear that the U.S. labor market remains volatile, January is typically slower and leads to an increase in layoffs as temporary workers hired for the busy holiday season are no longer needed.
“There is usually a surge in seasonal layoffs at this time, and that is what’s happening here,” said Jonathan Basile, a senior economist at Credit Suisse in New York. “Claims have shown an improving trend. It’s a vote of confidence for continued improvement in the labor market.”
Source: Bloomberg