US Applications for Unemployment Benefits Jumped Last Week

More Americans requested unemployment benefits last week, but the level remains near historic lows in a positive sign for the job market.

Jobless claims have reached a six-month high, and jumped 20,000 in the week ended on December 26.

While the data could have been affected by the holiday period, the sharp increase could indicate that the labor market is losing steam; economists had expected a total of 270,000, Investor’s Business Daily reported.

However, claims overall have held below 300,000 since early March, amid moderate economic growth and steady job creation that pushed the unemployment rate to 5 per cent in November, a seven-year low.

The average of new claims over the past month, meanwhile, rose by 4,500 to a seasonally adjusted 277,000, the Labor Department said Thursday. This shows an increase of 20,000 claims to the previous week’s 267,000 unrevised claims. The unusual jump may be cased by the holiday volatility.

The US Labor Department said there were no special factors impacting the data. When the dust settles, we’ll see claims drop back down.

It has been speculated that the increase in the unemployment rate has been due to the volatility introduced when the numbers are adjusted for seasonal variations.

As per the statistical figures released for the week that ended December 19, number of people continuing to receive benefits rose by 3,000 to 2.2 million. Part of the reason is the strong job market improvement. These data are reported with a one-week lag. The last time claims were this high was during the week of July 4.