Jobless Claims Creep up for Second Consecutive Week

Unemployment claims keep climbing, although some economists are still reportedly confident in the labor market.

Figures released Thursday (Dec. 28) by the U.S. Department of Labor showed that jobless claims reached 218,000 for the week ending Dec. 23, a 12,000 claim increase from the prior week.

In total, 1.9 million Americans were collecting unemployment benefits for the week ending Dec. 16, a 14,000-person increase from the prior week.

Economists polled by Reuters had expected initial claims for last week to reach 210,000, with that report framing the new numbers as a sign of a cooling labor market.

A separate report by Bloomberg described the claims figures as still indicating a strong labor market, with first-time applications at historically low levels.

Bloomberg also noted that next week will see the government’s monthly job report, with economists predicting a 170,000 increase in payrolls for December, another indicator of strong labor demand.

The numbers come a week after the U.S. Department of Commerce released new data that suggested inflation in the U.S. is reaching the Federal Reserve’s target.

The personal-consumption expenditures price index, the Fed’s preferred inflation measure, fell 0.1% in November compared to the previous month, the first decline since April 2020.

Meanwhile, consumer sentiment in the U.S. has shown gains, up 13% from November to December.

Consumer spending was up 0.2% between October and November, an indication that Americans have renewed confidence in the economy and feel comfortable spending.

Yet not all consumers are showing this level of enthusiasm. Thirty-eight percent of all consumers reported being worse off than last year, and 62% said they were very or extremely worried about the economic outlook.

PYMNTS Intelligence found that Generation Z seems to be an anomaly here, with 41% of consumers in this age group saying their financial situation has gotten better this year as compared to last year, while 31% say the opposite.

“This generation is the only one with a higher number of consumers who claim to have improved their financial situation this year,” PYMNTS wrote earlier this month.