US weekly initial jobless claims inch higher as Americans prevail omicron fear

• Financial

On Thursday, US Labor Department data had unveiled that the number of Americans filing for first-time state unemployment aids rose marginally last week even as rapidly surging omicron cases disrupted business activities, suggesting an utter resilience in a US labor market which has been gathering momentum at a break-neck pace since fourth quarter of 2022.

Nonetheless, although US Labor Department data had shown a slight increase in initial claims last week, US labor market continued to tighten amid a sheer lag in available workers with a record 4.5 million Americans voluntarily quitting their jobs on November.

However, with Omicron variant currently accounting for a 95 per cent of entire US pandemic cases and a peak is likely in late-January as cited by US pandemic response head Dr. Anthony Fauci, a significant scale of increase in claims over coming weeks would be unlikely, suggested analysts.

Meanwhile, addressing to an underlying strength in US labor market which became more evident since Q4, 2021, an economist at JPMorgan in New York, Daniel Silver said, “It is possible that the recent spread of COVID has put that earlier downward trend on hold.

That said, it is an encouraging sign for the labor market that claims have not meaningfully jumped in response so far”.

US initial claims inch higher

According to US Labor Department data, the number of Americans filing for state unemployment benefits for first time on their lives, increased 7,000 to a seasonally adjusted 207,000 over the week that ended on January 1, missing an analysts’ forecast of 197,000 filings.

Initial claims were chartering around 200,000 over recent months, while a figure between 250,000 to 300,000 is widely contemplated as a sign of salubrious labor market landscape. Nonetheless, however, continuing claims rose 36,000 to 1.754 million over the week that ended on December 25.