Jobless Claims Rise Amid Corporate Layoffs

Jobless claims rose more than expected last week, with analysts attributing the rise to layoffs by some major corporations and to snowstorms.

During the week ended Saturday (Feb. 22), the number of Americans filing initial claims for unemployment insurance increased by 22,000, the Department of Labor said in a Thursday (Feb. 27) press release. The number rose to 242,000, up from the previous week’s revised figure of 220,000.

The four-week moving average increased by 8,500 and was gauged at 224,000, up from the previous week’s revised average 215,500.

The increase in initial claims was greater than that expected by economists surveyed by Bloomberg. Their median forecast was for 221,000 applications.

Bloomberg attributed the increase to layoffs announced by Meta, Starbucks and Southwest Airlines.

It was reported Feb. 7 that Meta was set to begin its previously announced workforce reduction on Feb. 10. It was said that these layoffs would impact 5% of the company’s more than 72,000 employees.

The Bloomberg report noted that claims by federal workers are generally not included in these initial claims numbers but that those by workers from companies doing business with the government or getting federal funding are included. It added that these applications probably totaled no more than 5,000 during the week.

It was reported Feb. 13 that mass government layoffs had begun under the White House’s plan to shrink the federal bureaucracy.

Reuters reported that the economists it surveyed had expected to see 221,000 initial claims for unemployment benefits.

Its report attributed the rise to snowstorms experienced in many parts of the country and to volatility caused by the Presidents’ Day holiday.

Reuters added that there was no sign of the data being affected by the layoffs of federal workers, but that this could change in the coming weeks.

The Department of Labor also reported Thursday that the number of insured unemployment dropped by 5,000 during the week ended Feb. 15. It dropped to 1,862,000, down from the previous week’s revised level of 1,867,000.

The insured unemployment rate remained at 1.2%, which was unchanged from the previous week.

The states with the greatest increases in initial claims during the week ended Feb. 15 — Kentucky, with an additional 3,012, and Tennessee, with another 2,766 — both attributed the increase to layoffs in the manufacturing industry.

California had the biggest decrease, with 5,530 fewer initial claims for unemployment, but did not submit comments to the Department of Labor.

Pennsylvania, which had the second-largest decrease, at 1,100, attributed the drop to fewer layoffs in several industries.

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