The number of Americans filing for jobless benefits inched up modestly last week as businesses continued to retain staff despite economic uncertainty around U.S. trade policy.
The Labor Department reported Thursday that jobless claims for the week ending July 26 rose by 1,000 to 218,000, below the 225,000 new applications analysts had forecast.
It was the first time in seven weeks that benefit applications increased, although layoffs remain at historically low levels.
Weekly applications for jobless benefits are seen as representative of U.S. layoffs and have mostly settled into a historically healthy range between 200,000 and 250,000 since Covid throttled the economy in the spring of 2020, wiping out millions of jobs.
Earlier in July, the Labor Department reported that U.S. employers added a surprisingly strong 147,000 jobs in June, adding to evidence the American labour market continues to show resilience despite uncertainty over President Donald Trump’s economic policies. The job gains exceeded expectations, and the unemployment rate ticked down to 4.1% from 4.2% in May.
The government is set to release its July jobs report on Friday.
Though top-line numbers reflect a broadly healthy labour market by historical standards, some weakness has surfaced as employers contend with fallout from Trump’s policies, especially his aggressive tariffs, which raise prices for businesses and consumers. If consumers continue to pull back on spending, a decline in demand could push businesses to freeze hiring or cut staff.
This week, government data showed that employers posted 7.4 million job vacancies in June, down from 7.7 million in May. The number of people quitting their jobs — a sign of confidence in their prospects elsewhere — fell in June to the lowest level since December. Hiring also declined from May.
The deadline for most of Trump’s proposed import tariffs was extended again until Friday, though some deals have been made and other negotiation deadlines have also been extended. Unless Trump reaches agreements with countries to lower the tariffs, economists fear they could drag on the economy and spark another rise in inflation.
Companies that have announced job cuts this year include Procter & Gamble, Dow, CNN, Starbucks, Southwest Airlines, Microsoft, Google and Facebook parent company Meta. Most recently, Intel and The Walt Disney Co. announced staff reductions.
The Labor Department’s report Thursday also said the four-week average of claims, which smooths out some week-to-week fluctuations, fell by 3,500 to 221,000.
The total number of Americans collecting unemployment benefits for the previous week, ending July 19, was unchanged at 1.95 million.