U.S weekly jobless claims suddenly increased last week, reversing a steady decline

The number of Americans filing new claims for unemployment benefits climbed last week for the first time in more than a month. 

The Labor Department said on Thursday that initial claims for state unemployment benefits totaled 412,000 for the week ending June 12, up from 375,000 the previous week. The rise was the first since late April.

The four-week moving average, which smoothes out week-to-week volatility, hit a new epidemic low of 395,000. This is the lowest average level since March 2020, when the pandemic began in the United States.

Dow Jones polled economists, predicted 360,000 new claims for the previous week.

According to unadjusted statistics, the rise essentially came from two states: Pennsylvania (+21,590) and California (+15,712).

Although employment is still 7.6 million jobs behind its high in February 2020, the economy is experiencing a labor shortage. A lack of childcare services keeps some parents, primarily women, at home.

Several states, including Iowa and Alaska, either canceled all federal government-funded benefits or only the $300 supplement last Saturday. Their Republican counterparts in 21 other states including Florida and Texas will phase off unemployment benefits between June 19 and July 10, months before the program expires in early September.

There are a record 9.3 million job openings, while 9.3 million people are officially unemployed, Reuters stated. 

While claims appear to be higher than the pre-pandemic average of around 220,000, economists expect it to fall as the recovery accelerates.

Employers created 559,000 jobs in May, falling short of many analysts' forecasts and highlighting employers' challenges filling unfilled positions as potential employees linger on the sidelines.