US Weekly Unemployment Claims at January High Despite Blockbuster Monthly Job Gains

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Weekly jobless claims in the United States have hit the highest level since late January, according to US Labor Department data on Thursday that ran counter to blockbuster monthly gains in employment.

“In the week ending August 6, the advance figure for seasonally adjusted initial claims was 262,000, an increase of 14,000 from the previous week’s revised level,” the Labor Department said in a news release.

The weekly claims data came barely a week after the Labor Department reported a monthly jobs gain of 528,000 in its non-farm payrolls report for July that came in more than twice the level forecast by economists.

The weekly claims, meanwhile, were virtually spot-on with the 263,000 increase expected by economists polled by US media.

“The [weekly] trend has been more to the upside, but the employment report from Friday showed a much stronger than expected gain [for the month],” economist Greg Michalowski said in a post on the ForexLive platform.

The labor market has been the juggernaut of the US economy, powering its recovery from the 2020 coronavirus outbreak.

Unemployment reached a record high of 14.8% in April 2020, with the loss of some 20 million jobs after the coronavirus breakout. Since, hundreds of thousands of jobs have been added every month, with the trend not letting up in July despite a negative 0.9% GDP growth in the second quarter this year, after a minus 1.6% growth in the first quarter that together accounted for a recession.

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