US jobless claims rise slightly, layoffs fall to 11-month low

US jobless claims rise slightly, layoffs fall to 11-month low

Initial jobless claims rose slightly last week as labor market conditions remained tight and layoffs fell to an 11-month low in July. Since March 2022, the labor market has largely weathered a 525 basis point Fed hike. Initial claims this year are in the lower end of the 194,000 to 265,000 range, in part because it’s hard to adjust data for seasonal patterns.

Automakers typically close factories in July to assemble new models, but these temporary shutdowns don’t always happen at the same time, which can skew the models the government uses to de-season the data. However, the overall labor market remains resilient as employers hoard workers as they try to find them during the pandemic. A strong labor market and subdued inflation are fueling more optimism that the economy will avoid a recession.