U.S. applications for jobless benefits saw a significant increase, reaching 241,000 for the week of April 26, indicating a potential shift in the labor market. Although layoffs are currently within a healthy range, there are growing fears that ongoing tariff threats may lead to an economic slowdown. The U.S. economy experienced a contraction of 0.3% in the first quarter, the first decline in three years, attributed to tariffs disrupting business operations. Meanwhile, jobs cuts initiated by the federal government are anticipated but yet to reflect in the data.
Jobless claim applications jumped by 18,000 to 241,000 for the week ending April 26, the Labor Department said Thursday. That's more than the 225,000 new applications analysts forecast and the most since late February.
Even though President Donald Trump has paused or pulled back on many of his tariff threats, concerns remain about a global economic slowdown that could upend what has been an historically resilient labor market.
According to the Commerce Department, contraction has already begun in the U.S. Commerce reported Wednesday that the U.S. economy shrank at a 0.3% annual pace from January through March as Trump's trade wars disrupted business.
Like his pledge to institute tariffs, Trump's promise to drastically downsize the federal government workforce has occupied much of the early weeks of his presidency and is still in motion.
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