U.S. Unemployment Claims Fall in Tight Job Market

Jobless claims hovered above pre-pandemic levels last week as employers avoid layoffs and many workers quit or remain sidelined in a tight labor market.

Initial claims for jobless benefits edged down to seasonally adjusted 268,000 last week from a revised 269,000 a week earlier, the Labor Department said Thursday. Claims are at the lowest level since the pandemic hit the U.S. economy last spring and are gradually drifting down toward pre-pandemic levels.

Though worker filings for unemployment benefits remain above their 2019 weekly average of 218,000, the recovery in claims has been much faster than after the 2007-2009 recession. Claims took about 1.5 years to fall below 300,000 after the economy began to recover from the Covid-19 pandemic. By comparison, they took roughly five years to cross that threshold after the recession ended in mid-2009.

The relatively rapid decline in claims is evidence employer demand for workers is unusually strong, economists say. Job openings are near record highs, but many businesses say they can’t find enough workers to fill the roles.

High worker turnover is one challenge for employers. Though many companies are trying to expand their workforces, they are simultaneously losing workers, said Evan Sohn, chief executive at Recruiter.com, a hiring and recruiting platform.