Slightly more Americans applied for unemployment assistance last week

WASHINGTON (AP) — The number of Americans applying for unemployment assistance rose slightly last week, but the total number of Americans collecting benefits remained at its lowest level in more than five decades.

Jobless claims rose by 1,000 to 203,000 for the week ending May 7, the Labor Department reported Thursday. The first applications generally follow the number of layoffs.

The four-week average for claims, which evens out some of the weekly highs and lows, rose 4,250 from the previous week to 192,750.

The total number of Americans collecting unemployment benefits for the week ending April 30 fell by 44,000 from the previous week to 1,343,000. It was the fewest since January 3, 1970.

American workers enjoy historically strong job security two years after the coronavirus pandemic plunged the economy into a brief but devastating recession. Weekly jobless claims have been consistently below the pre-pandemic level of 225,000 for most of 2022, even as the overall economy contracted in the first quarter.

Last week, the government announced that US employers added 428,000 jobs in April, leaving the unemployment rate at 3.6%, just above the lowest level in half a century. Hiring gains have been surprisingly steady in the face of the worst inflation in four decades, with employers adding at least 400,000 jobs for 12 straight months.

Earlier this month, the Bureau of Labor Statistics reported that U.S. employers posted a record 11.5 million job openings in March, a record two job openings for every unemployed person. A record 4.5 million Americans quit their jobs in March, a sign they are confident they can find better pay or working conditions elsewhere.

As hot as the labor market is, inflation is even hotter. On Thursday, the government announced that U.S. producer prices rose 11% in April from a year earlier, a sizable gain that indicates high inflation will continue to burden consumers and businesses In the coming months.

On Wednesday, the government announced that inflation fell slightly in April after months of relentless increases, but remained near a four-decade high. Consumer prices jumped 8.3% last month from a year ago, just below the 8.5% year-on-year rise in March that was the most raised since 1981.

Last week, the Federal Reserve stepped up its fight against the worst inflation in 40 years by raising its benchmark short-term interest rate by half a percentage point – its most aggressive move since 2000 – and signaling further significant rate hikes to come. The hike in the Fed’s key rate took it to a range of 0.75% to 1%, the highest point since the pandemic hit two years ago.

The Commerce Department reported last month that the US economy contracted in the last quarter for the first time since the pandemic recession hit two years ago, contracting at an annual rate of 1.4%, even as consumers and businesses continued to spend as a sign of underlying resilience.

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