US initial jobless claims drop below 400,000; layoffs dip 16.7% to 21-yr low in June



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US initial jobless claims drop below 400,000; layoffs dip 16.7% to 21-yr low in June

On Thursday, US Labour Department data had revealed that the number of Americans filing for first-time state unemployment benefits fell more-than-anticipated last week, while layoffs had been dropped to a 21-year-low last month, illustrating a modest labour market recovery as pandemic restrictions ease.

Nonetheless, although other economic data unveiled on Thursday had shown a moderate growth in factory activities in June, a shortage of available workers kept preventing a resurgence in rehiring despite a robust uptick in domestic demands as ISM (Institute of Supply Management) data had unfurled that a gauge of employment in US factories had contracted for the first time in seven months in June.

US weekly initial jobless claims fall more than expected

According to US Labour Department data, the number of Americans filing for initial jobless benefits fell 51,000 to a seasonally adjusted 364,000 during the week that ended on June 26, which happened to be the lowest reading since March 2020, beating an analysts’ estimate of 390,000 applications, however, jobless claims remained well above a 200,000-250,000 range widely contemplated as an indication to a healthy labour market.

Aside from that, continuing claims increase 56,000 to 3,469 million as US factory activity grew moderately last month as beforementioned. Nevertheless, job cuts had been trimmed 16.7 per cent last month to 20,476, the lowest reading in layoffs in more than two decades.

Meanwhile, citing prospects of a strong Summer season hiring, a chief economist at FWDBONDS in New York, Chris Rupkey said, “America's back to work and an important milestone was reached where new claims are back below the 400,000-barrier after a hiccup at the start of June.

Summer is always the strongest season for hiring each year, and this year is no exception.