The four-week moving average of initial jobless claims, which smooths out volatility, increased by 4,000 to 216,750. This uptick suggests a gradual increase in jobless claims rather than an isolated spike, reinforcing concerns that labor market conditions may be softening.
Weak Non-Farm Productivity Adds to Economic Worries
At the same time, non-farm productivity for the fourth quarter came in at 1.2%, missing the expected 1.5% and falling sharply from the previous quarter’s revised figure of 2.3%. Lower productivity growth can weigh on corporate profitability and wage growth, potentially dampening economic expansion. The combination of rising jobless claims and weaker productivity could signal a cooling labor market, which is a critical factor for the Federal Reserve’s interest rate decisions.
