US jobless claims fall for 1st time in a month

WASHINGTON — Fewer Americans applied for unemployment benefits last week following three consecutive increases amid a surge in cases of the omicron variant of COVID-19.

Jobless claims fell by 30,000 to 260,000 last week, the Labor Department reported Thursday, fewer than the 265,000 analysts were expecting.

The four-week average of claims, which compensates for weekly volatility, rose by 15,000 to 247,000, the highest in two months.

Altogether, nearly 1.7 million people were collecting jobless aid the week that ended Jan. 15, a nominal increase of 51,000 from the previous week.

Jobless claims, a proxy for layoffs, had fallen mostly steadily for about a year and late last year dipped below the pre-pandemic average of around 220,000 a week. Economists expect claims to return to those lower levels as the virus fades, which is already taking place in regions that were hit first with omicron infections.

The job market has bounced back from last year’s brief but intense coronavirus recession, and companies are desperate to retain and hire workers, despite the recent uptick in jobless claims.

The unemployment rate settled at 3.9% last month, a steady decline from nearly 15% in the spring of 2020 when the pandemic devastated the global economy.

Massive government spending and the vaccine rollout jump-started the economy as employers added a record 6.4 million jobs last year.

But hiring slowed in November and December last year as employers struggled to fill job openings.

Still, the unemployment rate fell last month to a pandemic low.