By MATT OTT, Associated Press Business Writer
Applications for U.S. jobless benefits rose to a three-month high last week but remained within the same healthy range of the past three years.
The number of Americans filing for jobless benefits rose by 22,000 to 242,000 for the week ending Feb. 22, the Labor Department said Thursday. Analysts projected that 220,000 new applications would be filed.
Weekly applications for jobless benefits are considered a proxy for layoffs.
The four-week average, which evens out some of the week-to-week volatility, climbed by 8,500 to 224,000.
Some analysts say they expect layoffs ordered by the Department of Government Efficiency to show up in the report in the coming weeks.
On Wednesday, senior U.S. officials set the government downsizing in motion via a memo dramatically expanding President Donald Trump’s efforts to scale back a workforce. Thousands of probationary employees have already been fired, and now the Republican administration is turning its attention to career officials with civil service protection.
Government agencies have been directed to submit by March 13 their plans for what is known as a reduction in force, which would not only lay off employees but eliminate positions altogether.
Despite showing some signs of weakening during the past year, the labor market remains healthy with plentiful jobs and relatively few layoffs.
Earlier this month, the Labor Department reported that U.S. employers added 143,000 jobs in January, significantly fewer than December’s 256,000 job gains. However, the unemployment rate ticked down to an even 4%, signaling a still very healthy labor market.
Late in January, the Federal Reserve left its benchmark lending rate alone after issuing three cuts late in 2024. Fed officials are closely monitoring inflation and the labor market for signs of a potentially weakening economy. They expect only two rate cuts this year, down from previous projections of four.
The most recent government consumer prices report that showed that inflation accelerated last month, creating some doubt about whether the Fed will be moved to cut rates at all this year.
The consumer price index increased 3% in January from a year ago, up from a 3 1/2 year low of 2.4% in September. The new data shows that inflation has remained stubbornly above the Fed’s 2% target for roughly the past six months after it fell steadily for about a year and a half.
Overall, while layoffs remain low by historical standards, some high-profile companies have announced job cuts already this year.
Workday, Dow, CNN, Starbucks, Southwest Airlines and Facebook parent company Meta have all trimmed their workforces already in 2025.
Late in 2024, GM, Boeing, Cargill and Stellantis announced layoffs.
The total number of Americans receiving unemployment benefits for the week of Feb. 15 fell by 5,000 to 1.86 million.
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