The job market in the USA recovers after weather fluctuations and strikes

In the United States, the number of new claims for unemployment benefits significantly decreased last week as the distorting effects of recent hurricanes subsided. The Department of Labor reported that initial claims fell by 12,000 to a seasonally adjusted 216,000 for the week ending October 26. This was below the 230,000 claims forecasted by economists surveyed by Reuters. At the beginning of the month, claims surged as Hurricane Helene disrupted economic activity in the southeastern US. Claims remained elevated mid-month after Hurricane Milton hit Florida. Additional claims resulted from work stoppages at Boeing, which forced the aircraft manufacturer into temporary layoffs, also negatively affecting Boeing's suppliers. The number of people continuing to receive benefits after an initial week of support decreased by 26,000 to a seasonally adjusted 1.862 million for the week ending October 19, according to the report. Despite weather-related and labor dispute fluctuations, the overall picture of the labor market appears largely unchanged. A report from the global outplacement firm Challenger, Gray & Christmas showed that job cuts planned by U.S. companies fell by 23.7% to 55,597 in October. However, the storms and labor conflicts likely dampened employment growth in October. Reuters reports that the number of new non-farm jobs in October is expected to have increased by 113,000, following an increase of 254,000 in September. The unemployment rate is expected to remain unchanged at 4.1%. On Friday, the Department of Labor will release the employment report for October. It is expected that the Federal Reserve officials will pay little attention to the report when they meet next week to cut interest rates by 25 basis points. The U.S. central bank had kicked off its easing cycle last month with an unusually large rate cut of half a percentage point, the first cut since 2020.