AP Business Writer, Matt Ott
WASHINGTON (AP) – Submissions to us jumped up last week, but American workers remain broadly and secure in their work despite economic uncertainty about global trade.
The Labor Bureau said Thursday that unemployment benefits applications increased from 14,000 to 240,000 for the week that ends May 24th. Analysts were forecasting 226,000 new applications.
The weekly application of unemployment benefits is considered representative of US layoffs and has settled in the historically healthy range of 200,000 to 250,000, since Covid-19 adjusted the economy in the spring of 2020, sweeping millions of jobs.
It blew away a sense of relief to financial markets early Thursday after a federal court blocked President Donald Trump’s cleaning fees for imports under the Emergency Act. Wednesday’s decision rattles global financial markets, craving trading partners, and questioned Trump’s signature economic policy that has raised fears about inflation and economic slump.
The Trump administration will soon file a notice of appeal, and the Supreme Court will almost certainly be asked to decide the matter. It remains unclear whether the White House will respond to the ruling by suspending all interim emergency power bills.
Trump had already suspended or dialed many of his tariff threats, but concerns lasted about the global economy slowing down that would overturn the robust US labor market.
In early May, the Federal Reserve held its benchmark lending rate at 4.3% in its third consecutive meeting, after cutting three times at the end of last year.
Federal Reserve Chairman Jerome Powell said there is a growing possibility of both higher unemployment and inflation. This is an unusual combination that complicates the dual mission of managing central bank prices and keeping unemployment low. Powell said the tariffs have weakened consumer and business sentiment.
The government reported Thursday that the US economy shrunk at a rate of 0.2% per year in the first quarter of 2025, a slight upgrade from the initial estimate. A surge in imports slowed growth as American companies tried to bring in foreign goods before Trump’s massive tariffs came into effect.
Trump is trying to rebuild the global economy by dramatically increasing import taxes to rejuvenate the US manufacturing sector.
Trump has also sought to significantly reduce the federal workforce, but many of these cuts have been challenged by courts and Congress.
Despite showing signs of debilitating over the past year, the labour market remains strong with abundant jobs and relatively few layoffs.
The government reported that US employers added an incredibly strong 177,000 jobs in April, with a healthy unemployment rate of 4.2%.
Companies that announced jobs this year include Workday, Dow, CNN, Starbucks, Southwest Airlines, Microsoft and Facebook parent company Meta.
Labour reported Thursday that the four-week average of unemployed people evenly drained some of the weekly ups and downs per week during more volatile stretches, down from 250 to 230,750.
The total number of Americans receiving unemployment benefits on May 17th has increased the highest since November 2021.
Original issue: May 29, 2025, 8:57am EDT
