The number of initial unemployment claims in the United States has risen to a new high since February: the Federal Reserve remains "unmoved" with confidence, and holiday fluctuations cannot conceal the resilience of the labor market.

According to data from the US Department of Labor, the number of initial jobless claims in the US rose to the highest level since February last week, which may reflect fluctuations around the Memorial Day holiday. As of the week ending May 30, the number of initial jobless claims increased by 13,000 to 225,000. Economists surveyed had estimated a median of 215,000. US initial jobless claims rise to highest level since February The report covers a period including Memorial Day and coincides with some schools beginning summer break. The four-week moving average of initial jobless claims, which is used to smooth fluctuations, rose to 214,750 people, also setting a record high since February. Although the number of applications has rebounded, it is still close to historic lows. Last week, the number of continuing claims for unemployment insurance, which measures the number of people receiving unemployment benefits, decreased to 1.78 million. Looking ahead, the continued increase in unemployment insurance claims may indicate that the rising costs and economic uncertainty brought about by the Iran war are beginning to put pressure on employers. In addition, continued investment in AI has led to job cuts in some tech companies, increasing the number of layoff announcements in the industry. Other data released on Thursday showed that US tech companies announced 38,242 job cuts in May, the highest in a single month in almost two years. According to data from executive search and outplacement firm Challenger, Gray & Christmas Inc., planned job cuts in the industry have increased by over 65% compared to the same period in 2025. Economist Eliza Winger said, "AI is increasingly driving targeted layoffs, but the data on unemployment insurance claims suggest that overall economic activity is not under great pressure." Before seasonal adjustments, there was little change in the number of initial jobless claims. Applications increased in California, Tennessee, and Minnesota, while they decreased in Texas and New Jersey. Another government report showed that the slowdown in labor productivity in the first quarter exceeded previous expectations. The growth rates of unit labor costs and output were revised downward, and inflation-adjusted hourly wages declined significantly. After a decline in the last three months of 2025, working hours increased at the beginning of this year. Nevertheless, nonfarm business labor productivity grew by 2.8% compared to the same period last year, indicating that businesses are gradually improving employee efficiency to mitigate cost pressures. How will the Federal Reserve interpret this? This data on initial jobless claims has limited direct "policy impact" on the Federal Reserve, but it will reinforce its wait-and-see stance. The rise to 225,000 is indeed the highest level since February, but it is widely attributed in part to seasonal disruptions around Memorial Day and the start of the summer season; the more crucial evidence is that continuing claims are still around 1.78 million and do not show an upward trend, meaning that even though layoff announcements (especially in the tech sector) are more prominent, the path for unemployed individuals to find jobs remains relatively smooth. The overall labor market remains stable with a tendency towards "low hiring, low layoffs" rather than a typical downward spiral. Therefore, the Fed's interpretation is more likely to be: this data does not warrant a rate cut, nor will it bring the question of "whether to raise rates again" back to the table. Nonfarm labor productivity grew by 2.8% year-on-year, indicating that companies are successfully improving employee efficiency and mitigating costs through investments in technologies such as AI. As economist Eliza Winger pointed out, current layoffs are more of a "structural transformation" rather than a "widespread recession", and overall economic activity remains highly resilient. This atypical cooling with "high productivity, low unit costs" allows the Fed not to worry about the economy rapidly decelerating towards a hard landing. In terms of trading implications, as long as there are no consecutive jumps in initial claims and the trend in continuing claims remains stable, it will be difficult for the market to push for rate cuts based on "weakening employment"; on the contrary, if energy costs raise uncertainties and costs for businesses, stagflationary pressures will make the Fed less willing to ease easily - the true trigger for a policy shift is still a combination confirmation of "significant rise in unemployment + simultaneous decline in inflation", rather than a "slightly higher but still manageable" initial jobless claims report during a holiday week.