Initial jobless claims in the United States rose by 2,000 to 223,000 in the second week of March, slightly below market expectations of 224,000, keeping claims at historically low levels.
US jobless claims hold at low level
Meanwhile, continuing claims, which track the number of people receiving unemployment benefits after an initial application, increased by 33,000 in the first week of the month, aligning with market forecasts. These figures reinforce the view that the U.S. labor market remains resilient despite prolonged restrictive monetary policy and a wave of weak economic data in the first quarter of the year.
The steady labor market performance suggests that businesses are largely holding onto workers, even as higher interest rates weigh on economic activity. However, some industries, particularly in manufacturing and technology, have seen sporadic layoffs due to slowing demand and cost-cutting measures.
Further details
In the meantime, unemployment claims filed under programs for federal government employees—closely monitored due to ongoing layoffs by the Department of Government Efficiency (DOGE)—declined by 514 to 1,066. Despite this decrease, reports indicate that many of the recent firings at DOGE were accompanied by severance packages, which temporarily prevent affected employees from immediately claiming benefits. This suggests that additional claims from laid-off government workers could surface in the coming months once severance periods expire.
Potential outlook
Looking ahead, labor market watchers will focus on upcoming employment reports, wage growth trends, and potential shifts in hiring sentiment among businesses. If economic conditions weaken further, initial jobless claims could begin trending higher, particularly if companies in interest-sensitive sectors such as real estate and finance start shedding jobs. However, as long as claims remain near these low levels, the Fed is likely to view the labor market as strong enough to sustain current policy stances while monitoring for any signs of softening in the broader economy.
