By WASHINGTON (Reuters) – The number of Americans filing new applications for unemployment benefits rose marginally last week, suggesting no material change in labor market conditions and reinforcing views that hurricanes and strikes had resulted in job growth almost stalling in October.
Initial claims for state unemployment benefits increased 3,000 to a seasonally adjusted 221,000 for the week ended Nov. 2, the Labor Department said on Thursday. Economists polled by Reuters had forecast 221,000 claims for the latest week.
Employment growth slowed sharply last month, with nonfarm payrolls increasing by only 12,000 jobs, the fewest since December 2020. That aligned with a jump in claims in early October as Hurricane Helene disrupted economic activity in the U.S. Southeast region. Applications stayed elevated through the middle of last month after Hurricane Milton lashed Florida.
A strike by factory workers at Boeing (NYSE:BA), which forced the planemaker to implement rolling furloughs, also weighed on payrolls in October. The disruptions from the hurricanes have almost faded and the striking workers have gone back to work after agreeing to a new contract this week, paving the way for an acceleration in job growth in November.
Economists expect Federal Reserve officials won’t place much emphasis on October’s employment report as they evaluate the state of the economy. The U.S. central bank later on Thursday is expected to cut its benchmark interest rate again, this time by a quarter of a percentage point to the 4.50%-4.75% range.
The Fed embarked on its policy easing cycle with an unusually large half-percentage-point rate cut in September, the first reduction in borrowing costs since 2020. It hiked rates by 525 basis points in 2022 and 2023 to curb high inflation.
The number of people receiving benefits after an initial week of aid, a proxy for hiring, rose 39,000 to a seasonally adjusted 1.892 million during the week ending Oct. 26, the claims report showed. The Boeing-related furloughs are mostly keeping the so-called continuing claims elevated.