US initial jobless claims fall below 400,000 as businesses ramp up hiring in May

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US initial jobless claims fall below 400,000 as businesses ramp up hiring in May

In what could be contemplated as a vindication of a vivid illustration of a ballooning US economy, which appears to be recovering from a pandemic-led slump much-faster than anticipated following an acceleration in vaccination drive alongside release of massive Government stimulus, the number of Americans filing for first-time state unemployment aids fell below 400,000 last week for the first time since the onset of pandemic on mid-March 2020, as US labour market landscape muscled up further.

Aside from that, other economic data revealed earlier in the day had shown that US private employers had created the highest number of jobs in more than 11 months in May, as a blowout upsurge in domestic demand following a broader reopening of US economy had bolstered labour market and reinvigorated a re-hiring spree across the world’s largest economy.

US initial jobless claims drop below 400,000

In tandem, according to US Labour Department data published earlier on the day, the number of Americans applying for unemployment benefits for the first time in their lives, decline 20,000 to a seasonally adjusted 385,000 during the week that ended on May 29, the lowest level since the onset of pandemic outbreak in the United States back in March, 2020 as beforementioned, beating an analysts’ estimate of 390,000 applications.

On March 11, 2020, WHO (World Health Organization) had declared the ongoing public health crisis a pandemic. Meanwhile, referring to a robust reopening of US economy, a chief US economist at High Frequency Economics in White Plains, New York, Rubeela Farooqi said, “The economic reopening is continuing and should be positive for job growth.

But supply and demand imbalances are creating frictions in the labor market that could be a headwind in the near term.