The number of new applications for unemployment benefits climbed 7,000 last week to 207,000, more than anticipated.
The new numbers were reported on Thursday morning by the federal Labor Department. The weekly reports on jobless claims are seen as a proxy for layoffs. Over the past several weeks, new jobless claims have generally trended downward as fewer people require economic assistance, although the reports are being watched closely to see what effect, if any, that the new omicron variant of COVID-19 will have on domestic employment.
Omicron has swept quickly through the country, resulting in event cancellations and renewed remote work for companies. This week the U.S. crushed its previous record for cases, with new cases climbing by more than 1 million in a single day. While cases are up more than 250% from two weeks ago, because of high levels of vaccination, deaths have trended down.
OMICRON SPURRING WORKER SHORTAGES ACROSS KEY INDUSTRIES
While the new surge in cases could portend bad news for the labor market, it is buttressed by recent weeks of better-than-anticipated jobless claim reports. Last month new claims for unemployment hit the lowest level for initial claims in 52 years, a sign that layoffs are very rare as employers try hard to hold on to workers.
“New jobless claims are up a bit in the latest week but remain close to the lowest levels in decades,” said Mark Hamrick, Bankrate’s senior economic analyst. “This suggests workers can be reasonably confident about job security and an upbeat employment outlook for this year.”
Thursday’s new numbers come after a worse-than-expected November jobs report. The economy added just 210,000 new jobs in November, much fewer than the half-million that were anticipated. Despite being worse than expected, the unemployment rate fell to 4.2%, where it was in mid-2017. The unemployment rate is still higher than the ultra-low 3.5% level it was at prior to the pandemic.
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On Friday, the Bureau of Labor Statistics will release data about job creation in December. Forecasters predict some 400,000 jobs were added and that the unemployment rate will drop slightly to 4.1%.
