12:23 PM EDT, 06/06/2024 (MT Newswires) -- Weekly applications for unemployment insurance in the US rose, government data showed, while a separate report from Challenger, Gray & Christmas showed that layoffs declined 1.5% on a sequential basis in May.

The seasonally adjusted number of initial claims increased by 8,000 to 229,000 in the week ended June 1, the US Department of Labor said Thursday. The consensus was for a 220,000 level in a survey of analysts compiled by Bloomberg. The previous week's reading was revised up by 2,000 to 221,000.

"New filings rose more than our above-consensus forecast in the week ended June 1," Oxford Economics Chief US Economist Ryan Sweet said. "However, initial claims are typically more volatile than normal around holidays, and Memorial Day isn't an exception."

The four-week moving average came in at 222,250, down by 750 from the prior week's average, which was revised up by 500. The average "remains comfortably below our estimate of the breakeven level, or that consistent with no monthly job growth," according to Sweet. Unadjusted claims declined by 1,734 on a weekly basis to 195,430.

For the week ended May 25, seasonally adjusted continuing claims totaled 1.79 million, almost in line with the Bloomberg consensus. Continuing claims rose by 2,000 from the previous week's level that was revised down by 1,000. The four-week moving average was about 1.79 million, gaining 2,750 from the previous week's downwardly revised average, according to the DOL.

Despite the week-over-week increase in headline continuing claims, "the level remains in a range that suggests the labor market remains tight," according to Jefferies US Economist Thomas Simons. "Continuing claims are still very low by any historical standard, and we still see the data as supporting the notion that people who lose a job are able to find a new one with relative ease."

Tennessee saw the highest increase in initial claims for the week ended May 25 at 1,880, followed by Michigan with 1,557 and Missouri with 839. The largest decrease was in California, where claims slid by 1,065, followed by Pennsylvania and Ohio.

US-based employers cut 63,816 jobs last month, down from 64,789 in April and a 20% decrease from a year ago, according to Challenger, Gray & Christmas. "Job cuts remained flat in May as companies assess performance and make plans for (the third quarter) and (fourth quarter)," said Andrew Challenger, the company's senior vice president. "The typical churn in a healthy labor market appears to be stalling."

Automatic Data Processing (ADP) on Wednesday reported a slower-than-expected 152,000 increase in May private sector employment. On Friday, the market is expecting last month's nonfarm payrolls to increase by 185,000, an acceleration from April's 175,000 gain, according to the Bloomberg consensus.