Weekly US jobless claims highest since 2021, but companies avoid risk of being caught short-handed

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Last week, the Fed raised its benchmark interest rate another quarter point. One of the Fed’s goals in raising interest 10 times in the past 14 months is to cool the job market and stifle rising wages.

A hiring sign is displayed at a retail store in Downers Grove, Ill., Monday, May 1, 2023. On Thursday, the Labor Department reports on the number of people who applied for unemployment benefits last week.

Many employers appear to have put a premium on retaining workers after some of them were caught short-handed by the rapid post-COVID-19 economic recovery. As a result, most economists don't envision waves of layoffs even if a recession were to strike later this year as many expect. That doesn't mean that more layoffs are not on the way, Shapiro said, but the numbers are likely to be less drastic compared with past economic downturns.

Last month, the Commerce Department reported that U.S. economy slowed sharply from January through March as higher interest rates hammered the housing market and businesses reduced inventories.mostly in the technology sector

 

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