Jobless Claims Spike to Highest Level in Over a Year Amid Hurricane Helene Impact
Initial jobless claims in the US surged by 33,000 to 258,000 in the week ending October 5, marking the highest level since August 2023, according to the Labor Department’s report on Thursday.
The spike is largely attributed to the effects of Hurricane Helene, which caused sharp increases in unemployment claims in Florida, North Carolina, and other affected states.
Economists had anticipated a smaller rise, predicting an increase of 5,000 to 230,000 claims. Despite the unexpected jump, analysts believe the surge is linked more to the storm’s impact than a significant slowdown in the broader labor market. The four-week average of claims, which smooths out weekly volatility, also rose by 6,750 to 231,000.
The total number of Americans receiving unemployment benefits climbed by 42,000 to 1.86 million, the highest since late July. Some economists note that while the labor market remains generally strong, high interest rates could be contributing to a gradual cooling trend.
In response to weakening labor data, the Federal Reserve recently shifted its focus, cutting its benchmark interest rate by half a percentage point to support the job market. This is part of the central bank’s broader aim to balance inflation control with maintaining employment growth.
Despite the surge in jobless claims, the US economy added a robust 254,000 jobs in September, surpassing expectations and easing some concerns about a labor market slowdown. Additionally, inflation has steadily declined, nearing the Fed’s 2% target.
With input from ABC News, the Hill, and Market Watch.
