In historical context, the numbers of Americans filing first-time unemployment benefits is still relatively low.
But they’re on the rise.
Filings for unemployment benefits rose to their highest level in eight months, climbing to 247,000 for the week ending May 31, according to statistics released by the Labor Department Thursday. That’s an increase of 8,000 claims and represents the most since early October. According to a report from The Associated Press, analysts had forecast 237,000 new applications.
Weekly applications for jobless benefits have mostly stayed in the 200,000 to 250,000 range since Covid hit the U.S. in March 2020 and cost millions of jobs.
In reporting their latest earnings, many companies have either lowered their sales and profit expectations for 2025 or not issued guidance at all, often citing the back-and-forth rollout of tariff announcements, according to the AP.
In early May, the Federal Reserve held its benchmark lending rate at 4.3% for the third straight meeting after cutting it three times at the end of last year.
Fed chair Jerome Powell said the potential for both higher unemployment and inflation are elevated, an unusual combination that complicates the central bank’s dual mandate of controlling prices and keeping unemployment low. Powell said that tariffs have dampened consumer and business sentiment.
Earlier this week, the government said U.S. job openings rose unexpectedly in April, but the AP reported other data that suggested that Americans are less optimistic about the labor market.
Tuesday’s report showed that the number of Americans quitting their jobs – a sign of confidence in their prospects – fell, while layoffs ticked higher. And in another sign the job market has cooled from the hiring boom of 2021-2023, the Labor Department reported one job every unemployed person. As recently as December 2022, there were two vacancies for every jobless American.
The government has estimated that the U.S. economy shrank at a 0.2% annual pace in the first quarter of 2025, a slight upgrade from its first estimate. Growth was slowed by a surge in imports as companies in the U.S. tried to bring in foreign goods before Trump’s massive tariffs went into effect.
The four-week average of jobless claims, which evens out some of the week-to-week gyrations during more volatile stretches, rose by 4,500 to 235,000, the most since late October.
The total number of Americans receiving unemployment benefits for the week of May 24 inched down by 3,000 to 1.9 million.
