American unemployment levels have fallen over the past week. Although there has been a recent slowdown in new US job growth, there appears to be enough for those seeking them. Claims for first-time state unemployment benefit fell by 10,000, equivalent to a seasonally adjusted 245,000 for the past week, ending June 3.
It is expected for American unemployment to increase during school summer vacations when people working in jobs related to school terms are unemployed. Cafeteria workers and school bus drivers generally find themselves without work during school breaks.
On Tuesday, the Labor Department reported that there were 259,000 new US job openings in April. This is the highest level of new jobs created since 2000. Benefit claims have been under 300,000 for over 2 years and the unemployment rate now stands at 4.3% – the lowest level for 16 years.
There were 138,000 new jobs created in May. This is way below the 181,000 monthly average for jobs created over the past 12 months. This relatively low figure has been accredited to companies being unable to find people suitable for the jobs available. This seems to be supported by the record high of job openings and the low level of layoffs.
One issue that a tightening of the labor market could be responsible for is interest rates. Some believe that this could result in the Federal Reserve increasing interest rates during the Fed meeting next week. It’s unlikely for this to influence any interest rate decisions at the FOMC meeting, but it could happen. It is highly expected that the Fed will announce a rate hike regardless of this factor.
Another aspect of Thursday’s report was a drop in those still claiming aid after their first week of benefits. This lay at 1.92 million people for the week ending May 27, a drop of 2,000. Not much of a drop, but a drop nevertheless. That makes eight weeks now where continuing claims have been below two million.
What does all this mean? Not a great deal in percentage terms, but it does indicate that unemployment is stable and perhaps even on a downward slope. There appears to be a trend of reducing claims and reducing unemployment. There is less of slack in employment terms, which indicates a potential strengthening of the economy.
Financially, US Treasuries dropped slightly in price while US stock index futures increased slightly. The Smerican unemployment figures had a minimal effect and next week’s FOMC meeting is awaited with interest.
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