Jobless claims surge by 33K to highest level in over a year heres why

The number of Americans filing for unemployment benefits last week jumped to its highest level in a year, which analysts are saying is more likely a result of Hurricane Helene — and the Boeing machinist strike — than a broader softening in the labor market.The Labor Department reported Thursday that applications for jobless claims jumped by 33,000 to 258,000 for the week of Oct.3.

That’s the most since Aug.5, 2023 and well above the 229,000 analysts were expecting.Analysts highlighted big jumps in jobless benefit applications last week across states that were most affected by Hurricane Helene, including Florida, North Carolina, South Carolina and Tennessee.“Claims will likely continue to be elevated in states affected by Helene and Hurricane Milton as well as the Boeing strike until it is resolved,” said Nancy Vanden Houten, lead US economist of Oxford Economics.

“We think, though, that the Fed will view these impacts as temporary and still expect it to lower rates by (25 basis points) at the November meeting.”Venden Houten said that Washington state was the most impacted by the Boeing strike and accounted for a disproportionate share of the increase.Applications for jobless benefits are widely considered representative of layoffs in a given week, however they can be volatile and prone to revision.The four-week average of claims, which evens out some of that weekly volatility, rose by 6,750 to 231,000.The total number of Americans collecting jobless benefits rose by 42,000 to about 1.86 million for the week of Sept.28, the most since late July.Outside of the weather and labor strife, some recent labor market data has suggested that high interest rates may finally be taking a toll on the labor market.In response to weakening employment data and receding consumer prices, the Federal Reserve last month cut its benchmark interest rate by a half of a percentage point as the central bank shifts its focus from taming inflation toward supporting the jo...