Weekly jobless claims rose the week that ended February 12 by 23,000 claims, according to the Labor Department. While these claims unexpectedly rose for the week, claims as a whole are still below pre-pandemic numbers and still signal that the labor market is working towards recovery, even if it is tightening. Claims now stand at 248,000 for the past week.
Analysts did forecast a lower weekly claims rate. However, economists don’t believe that this latest report will harm the February jobs report — or the jobs growth that they believe the country will experience in 2022. The labor market has struggled since the pandemic began in various ways. Towards the end of 2021 and into 2022, signs have pointed towards labor market recovery.
Hiring has picked up in the past few months. This could have something to do with the increase in jobless claims for the week. Previously, weekly claims continued to drop to record lows, as employers were having difficulties finding enough qualified workers to hire. As a result, employers have often kept on as many workers as they could to continue doing business as normal — allowing weekly jobless claims to decrease with each release as a result.
However, new reports have revealed that hiring has actually greatly improved in the past two months. December, which was initially thought to have been a bad month for hiring, was recently revealed to have actually been a great hiring month when data was reevaluated.
As a result, as hiring has picked up, then employers could end up laying off employees if they believe they will be able to hire a new worker to take their place — something that couldn’t be assured just a few months ago. Now, this could change in the upcoming months, especially if hiring begins to grow slowly again in the next few weeks.
Plus, the ongoing pandemic could also continue to cause issues. While it does appear that the Omicron variant, which caused major issues for many businesses in the past few months because of its highly contagious nature, is now slowing down in infections, another wave of the pandemic could affect the labor market, once again.
Even with this increase in weekly jobless numbers, however, the labor market seems to be in a better place than it ever has since the pandemic began. This increase in jobless claims is still well below what it used to be during the pandemic, and it is actually still below what was normal before the pandemic. In this way, it does appear as if the labor market is still working towards recovery and growth.
The jobs report for February will give economists a better understanding of where the labor market stands, especially after this jobless report. For the most part, all economists are still forecasting growth in hires and in the labor market as a whole. As this increase in weekly jobless claims is still incredibly low, continuous growth does still seem more than likely — unless things change drastically in the near future.