The number of initial applications for first-time unemployment benefits fell last week, but economists expect that to change in the weeks and months to come as the Trump administration continues its widescale slashing of government jobs.
There were an estimated 221,000 jobless claims filed for the week ending March 1, according to seasonally adjusted data released Thursday by the Department of Labor. That’s 21,000 down from the prior week’s tally and also below economists’ estimates for 235,000 claims.
The number of first-time jobless claims settled back down after unexpectedly surging the week before, underscoring that the prior week’s increase was likely due to one-off factors such as a holiday, a deadly winter storm and frigid temperatures.
Thursday’s report showed that continuing claims, which are filed by people who have received at least one week of unemployment benefits, rose by 42,000 to 1.897 million for the week ending February 22.
Initial claims data — while one of the timeliest indicators of labor market health — also can be quite volatile and fluctuate from week to week due to factors such as weather, temporary layoffs, other state-level factors, and holidays.
What could come: Still, the weekly report is becoming even more closely watched because the Trump administration is making massive employment cuts throughout the federal government and cutting off spending, sending ripple effects through the private sector as well.
Thursday’s report from the Labor Department provided the first hint of what could come.
The number of federal workers who filed initial claims under the Unemployment Compensation for Federal Employees program totaled 1,634 for the week ending February 22; that’s up 1,020 filings from the week before.
Also, it’s possible that hundreds of thousands of government workers could be laid off as the Department of Government Efficiency slashes roles. However, the impact on US labor market data might not happen in one fell swoop, economists say.
While some federal employees have been laid off in recent weeks, others are serving out a paid notice period where they essentially quit but won’t be unemployed weeks or even months from now.
