The Federal Reserve has embarked on its most aggressive tightening campaign since the 1980s this year in an effort to tame the highest inflation in a generation. The steep interest-rate hikes have had an impact on sectors such as housing and construction, but overall the labor market has remained robust.
The list of high-profile technology companies announcing job cuts or hiring freezes has been growing, from Amazon.com Inc. to Facebook parent company Meta Inc. and personal-computer maker HP Inc., which said this week it would eliminate as many as 6,000 jobs.
The mounting layoffs in the sector don’t necessarily portend weakness in the broader market because many tech companies had ramped up hiring during the pandemic-era e-commerce boom. Still, other industries aren’t immune. Even FedEx Corp. is furloughing workers in its freight unit ahead of what’s usually the busiest season of the year for the company.
What Bloomberg Economics says:
“Initial jobless claims for the week ending Nov. 19 surged and continuing claims remained on a persistent uptrend, pointing at softening in the labor market. The 113,000 increase in continuing claims between the survey weeks for the November employment report is consistent with layoffs spreading in the technology industry, as hiring freezes and job cuts mount in select industries.”—Eliza Winger, economist
The four-week moving average, which smooths out volatility from week to week, increased to 226,750.
On an unadjusted basis, initial claims rose by about 48,000 to almost 248,200 last week. The increases were spread across the states, with California, Illinois and Georgia among the largest ones.
The claims figures tend to be more volatile around US holidays. The latest data spanned the week between Veterans Day and Thanksgiving.