Jobless Claims Fell Last Week, Pointing to Tight Labor Market

The four-week moving average of weekly claims, which smooths out volatility, was 197,500, a decrease of 9,250 from the prior week. In 2019, claims averaged about 220,000 a week.

Continuing claims, which reflect the number of people seeking ongoing unemployment benefits, ticked up to 1.675 million, an increase of 20,000, in the week ended Jan. 14. Continuing claims are up from lows touched last spring, suggesting it is taking longer for some to find a new job. 

Broadly, the U.S. labor market remains strong but has gradually lost steam in recent months. Employers added 223,000 jobs in December, the smallest gain in two years. There were 10.5 million job openings in November, down from the peak 11.9 million in March, but far exceeding the number of unemployed Americans seeking work, a mismatch that has fueled competition for workers.

“We’re making more jobs than we have new entrants or re-entrants coming in willing to take them,” Federal Reserve Bank of San Francisco President

Mary Daly

said at a WSJ Live event earlier this month. “So we’re still out of balance, but it is slowing.”

Some large companies including

Microsoft Corp.

,

Goldman Sachs Group Inc.

and Google parent

Alphabet Inc.

have announced cuts. Layoffs in finance, real estate and technology are beginning to rise from historically low levels as companies that bulked up their staffs earlier in the pandemic shed employees.

Workers generally can’t seek jobless benefits until after they separate from the company, which can be weeks after the layoff announcement. Also, high-skilled workers might quickly find new jobs in a still-tight labor market and forgo seeking benefits.

There have been a handful of announcements outside of tech and finance.

3M Co.

said this week it was cutting 2,500 manufacturing jobs globally, citing weakening consumer demand and turbulent global markets. Employers have reduced their use of temporary workers, a trend that can be a harbinger of broader job losses.

There remains signs of strength elsewhere in the labor market. Wage growth remains particularly strong for those at the low end of the labor market, especially in the retail sector and in leisure and hospitality. Wages rose 5% from a year earlier to $28.07 for private-sector workers not in supervisory roles in December, according to the Labor Department.

Starting next month,

Walmart Inc.’s

U.S. workers in stores and warehouses will earn a starting wage of at least $14 an hour, up from $12, the country’s largest private employer said in a memo to staff Tuesday.

Write to Gabriel T. Rubin at [email protected]

The four-week moving average of weekly claims, which smooths out volatility, was 197,500, a decrease of 9,250 from the prior week. In 2019, claims averaged about 220,000 a week.

Continuing claims, which reflect the number of people seeking ongoing unemployment benefits, ticked up to 1.675 million, an increase of 20,000, in the week ended Jan. 14. Continuing claims are up from lows touched last spring, suggesting it is taking longer for some to find a new job. 

Broadly, the U.S. labor market remains strong but has gradually lost steam in recent months. Employers added 223,000 jobs in December, the smallest gain in two years. There were 10.5 million job openings in November, down from the peak 11.9 million in March, but far exceeding the number of unemployed Americans seeking work, a mismatch that has fueled competition for workers.

“We’re making more jobs than we have new entrants or re-entrants coming in willing to take them,” Federal Reserve Bank of San Francisco President

Mary Daly

said at a WSJ Live event earlier this month. “So we’re still out of balance, but it is slowing.”

Some large companies including

Microsoft Corp.

,

Goldman Sachs Group Inc.

and Google parent

Alphabet Inc.

have announced cuts. Layoffs in finance, real estate and technology are beginning to rise from historically low levels as companies that bulked up their staffs earlier in the pandemic shed employees.

Workers generally can’t seek jobless benefits until after they separate from the company, which can be weeks after the layoff announcement. Also, high-skilled workers might quickly find new jobs in a still-tight labor market and forgo seeking benefits.

There have been a handful of announcements outside of tech and finance.

3M Co.

said this week it was cutting 2,500 manufacturing jobs globally, citing weakening consumer demand and turbulent global markets. Employers have reduced their use of temporary workers, a trend that can be a harbinger of broader job losses.

There remains signs of strength elsewhere in the labor market. Wage growth remains particularly strong for those at the low end of the labor market, especially in the retail sector and in leisure and hospitality. Wages rose 5% from a year earlier to $28.07 for private-sector workers not in supervisory roles in December, according to the Labor Department.

Starting next month,

Walmart Inc.’s

U.S. workers in stores and warehouses will earn a starting wage of at least $14 an hour, up from $12, the country’s largest private employer said in a memo to staff Tuesday.

Write to Gabriel T. Rubin at [email protected]