Weekly US unemployment claims move higher after holidays

Unemployment increased last week Stateside, according to one of the most-tracked barometres of the labour market's health, as firms moved to shed workers taken on ahead of the holidays.

Initial unemployment claims for the seven days ending on 16 January rose by 10,000 to reach 293,000, according to the Bureau of Labour Statistics.

Economists at Barclays had been expecting a reading of 285,000.

The reading for the previous survey week was revised higher by 1,000 claimants to 284,000.

A four-week moving average of initial unemployment claims rose by 6,500 to 285,000.

Secondary unemployment claims, those which are not filed for the first time and referencing the week to 9 January, decreased by 56,000 to 2.208m.

"We feared an even bigger increase, so we are relieved by this number. The problem is the seasonal adjustment, which struggles to cope in January as huge numbers of people are laid off from temporary jobs after the holidays.

"The trend in claims appears to have risen in recent weeks, but it’s very dangerous to draw any firm conclusions from the data over the holidays and the early part of the New Year; the seasonal adjustment problems can persist for some time," said Ian Sheprdson, chief economist at Pantheon Macroeconomics.

"Taken against the survey week reading for December (272k), this morning’s print suggests a slower pace of employment growth at the start of 2016, all else equal.

"Balancing this negative signal, continuing claims have fallen back towards their lows. We will be closely watching initial claims in the coming weeks to discern whether labor market separations are rising or the current blip is little more than seasonal volatility," said Barclays's Jesse Hurwitz.