States reported that 264,000 workers filed for new unemployment benefits during the week ending June 17, unchanged from last week’s revised level. This is the highest level for initial claims since October 2021 and the third straight week of elevated claims.
About 1.75 million workers continue to claim unemployment benefits. Economists point out that unemployment remains low by historic standards, though the unemployment rate rose to 3.7 percent in May.
Layoffs were expected to spike this year as the effects of interest rate hikes spread through the economy, but that has not happened yet to any significant degree. Some still expect a mild recession by the second half of the year or in early 2024, while others point to the labor market’s remarkable resilience throughout the lengthy interest rate hike campaign designed to slow it down.