US jobless claims fall by less than expected to 227,000

The number of Americans filing new claims for unemployment benefits declined less than expected last week, suggesting the US labor market remains resilient despite signs of cooling hiring momentum and recent weather-related disruptions.

Seasonally adjusted initial jobless claims fell by 5,000 to 227,000 in the week ending February 7, the Labor Department said on Thursday.

The figure was marginally higher than economists’ expectations of 225,000, according to a Dow Jones survey.

The modest decline reversed only a fraction of the previous week’s jump, which had been attributed to snowstorms, freezing temperatures and seasonal volatility at the turn of the year.

Economists said lingering disruptions from winter storms likely kept claims from falling further.

Trend indicators show mild softening

Underlying trends in the labor market showed signs of gradual softening.

The four-week moving average of initial claims rose by 7,000 to 219,500, indicating that layoffs remain elevated compared with recent months.

The insured unemployment rate stood unchanged at 1.2% in the week ending January 31.

Continuing claims, which track the total number of people receiving unemployment benefits, increased to 1.86 million in the week through January 31 from 1.84 million a week earlier.

Because continuing claims lag initial claims by a week, economists said they provide a clearer picture of underlying labor-market conditions beyond short-term volatility.

Mixed signals from broader labor data

Recent economic data paint a mixed picture of the US labor market.

The economy added 130,000 jobs in January, exceeding expectations, while the unemployment rate edged down to 4.3%, according to the Bureau of Labor Statistics.

However, analysts noted that job gains were concentrated in healthcare and social assistance, while other sectors showed more muted hiring activity.

Layoff announcements and a pullback in job openings have contributed to a more cautious outlook.

Economists described the labor market as being in a “low hire, low fire” phase, where employers are reluctant to cut staff aggressively but also hesitant to expand payrolls.

They also pointed to trade and immigration policies as factors constraining labor supply and demand, though many remain optimistic that employment growth could strengthen later in the year, partly supported by tax cuts.

Pressures persist for job seekers

Data on specific groups showed a slight increase in claims among former federal employees and newly discharged veterans.

Initial claims filed by former federal civilian workers rose to 615, while newly discharged veterans filed 378 claims, both up from the previous week.

Despite relatively low unemployment, structural pressures remain in the job market.

The median duration of unemployment stayed near levels last seen four years ago, and recent college graduates continue to face difficulties securing jobs.

Economists said seasonal volatility has complicated the interpretation of recent data, but the overall picture suggests a labor market that is slowing but not weakening sharply.