Fewer Americans apply for jobless benefits, labor market still showing strength

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“We expect jobless claims will resume their upward trend as the economy weakens and enters a mild recession in the second half of the year, and as layoffs become more widespread,” wrote economist Nancy Vanden Houten.

Fewer Americans applied for jobless benefits last week following a previous spike that many analysts took as a sign that higher interest rates were finally cooling the labor market.

While news of the fraudulent Massachusetts numbers made the hand-wringing over last week's jump in claims seem overblown, economists still expect a slow uptick in layoffs in the second half of 2023. Overall, 1.8 million people were collecting unemployment benefits the week that ended May 6, about 8,000 fewer than the previous week.

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