12:15 PM EDT, 06/27/2024 (MT Newswires) -- Weekly applications for unemployment insurance in the US declined more than market expectations, while continuing claims rose to the highest level since late 2021, government data showed Thursday.

The seasonally adjusted number of initial claims decreased by 6,000 to 233,000 in the week ended June 22, according to the US Department of Labor. The consensus was for a 235,000 level in a survey of analysts compiled by Bloomberg. The previous week's reading was revised up by 1,000 to 239,000.

"Despite the drop, initial claims continue to drift higher on a trend basis, suggesting that, while layoffs remain low for now, demand for workers is easing and more individuals are applying for benefits," Oxford Economics Lead US Economist Nancy Vanden Houten wrote in a note. "Any sign that the demand for labor is weakening enough to push up the unemployment rate would add to the case for the (Federal Reserve) to start to lower rates in September."

The four-week moving average came in at 236,000, rising by 3,000 from the prior week's average, which was revised up by 250. Unadjusted claims slipped by 3,570 on a weekly basis to 224,410.

For the week ended June 15, seasonally adjusted continuing claims totaled 1.84 million, its highest level since Nov. 27, 2021, ahead of the Bloomberg consensus of about 1.83 million. Continuing claims jumped by 18,000 from the previous week's level that was revised down by 7,000. The four-week moving average was about 1.82 million, its highest level since Dec. 4, 2021, gaining 12,250 from the previous week's downwardly revised average, according to the DOL.

"The rise in continued claims on the surface points to a moderate in job growth following a 272,000 gain in May," Vanden Houten said. "However, increases in claims in California and Minnesota may reflect noise that is overstating the rise in claims."

Connecticut saw the highest increase in initial claims for the week ended June 15 at 2,168, followed by Wisconsin with 1,262 and Texas with 1,017. The largest decrease was in California, where claims dropped by 4,298, followed by Minnesota with 1,474 and Illinois with 1,466.