WASHINGTON (Reuters) -The number of Americans filing new applications for unemployment benefits increased more than expected last week, potentially hinting at a pick-up in layoffs from tariffs, which weighed on the economy in the first quarter.
Initial claims for state unemployment benefits jumped 18,000 a seasonally adjusted 241,000 for the week ended April 26, the Labor Department said on Thursday. Economists polled by Reuters had forecast 224,000 claims for the latest week.
The economy contracted last quarter for the first time in three years, swamped by a flood of imports as businesses tried to avoid duties from President Donald Trump’s tariffs.
Economists expect the aggressive trade policy to result in a wave of job losses. The tariffs, expected to be a drag on domestic demand, are already prompting some companies to reduce staff. United Parcel Service said on Tuesday it would slash 20,000 jobs and shut 73 facilities as part of a planned reduction in deliveries for Amazon.com.
Businesses in general have mostly adopted a wait-and-see attitude and are retaining their workforces, while remaining cautious about adding headcount.
The number of people receiving benefits after an initial week of aid, a proxy for hiring, soared 83,000 to a seasonally adjusted 1.916 million during the week ending April 19, the claims report showed.
The claims data have no bearing on April’s employment report, scheduled for release on Friday. Nonfarm payrolls likely increased by 130,000 jobs last month after rising 228,000 in March, a Reuters survey of economists showed. The unemployment rate is forecast unchanged at 4.2%.
(Reporting by Lucia Mutikani; Editing by Chizu Nomiyama)
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