Minutes from the Federal Reserve’s Jan. 27-28 policy meeting, released Wednesday, showed that the “vast majority of participants judged that labor market conditions were showing some signs of stabilization.” Still, concerns remained about downside risks to the labor market.
The minutes also noted that some policymakers “raised the possibility that a further decline in labor demand could sharply increase the unemployment rate in a low hiring environment, or that the concentration of job growth in a few less cyclically sensitive sectors would potentially signal increased vulnerability in the overall labor market.”
The claims data covered the week the government surveyed employers for the nonfarm payroll portion of the February employment report. Job growth accelerated in January, although almost all of the employment growth came from the health care and social assistance sectors.
Policymakers and economists say immigration policies are limiting job growth. Lingering uncertainty over import tariffs continued to dampen hiring, while artificial intelligence also added an extra layer of caution, economists said. The number of people receiving unemployment benefits after an initial week of relief, a proxy for hiring, rose by 17,000 to 1.869 million in the week ended Feb. 7, the claims report shows.
The so-called persistent claims suggested that laid-off workers were experiencing difficulties finding new jobs.
The median duration of unemployment is near its highest level in four years. The lack of hiring has had a significant impact on recent graduates, who are unable to apply for unemployment benefits due to no or limited work history and are not captured in claims data.
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