Applications for unemployment benefits dipped slightly for the week ending March 16, according to data released Thursday by the Department of Labor’s Bureau of Labor Statistics.

Week over week, initial claims decreased by 2,000 to 210,000. The four-week moving average, however, was 211,250, representing an increase of 2,500 from the previous week’s average.

According to the data, 1.8 million Americans were collecting unemployment benefits during the week that ended March 9. That’s up by 4,000 from the previous week.

The unemployment rate is 3.9%, which is slightly higher than February’s rate of 3.7%. The unemployment rate has now been below 4% for 25 consecutive months — more than two years. This is the longest such streak  the rate has been below since the 1960s, according to the Associated Press. 

The largest increases in initial claims for the week ending March 9 were in Oregon (2,216), California (462), Indiana (427), Texas (392) and Nevada (342). The largest decreases were in –446), Massachusetts (–305) and Vermont (–289).

Layoffs remain at low levels

The decrease in initial claims, economists say, suggests that job growth remained strong in March.

“Applications for unemployment benefits are viewed as a proxy for layoffs and a sign of where the job market is headed,” the Associated Press reported. Overall, according to the news service, layoffs have reached pre-pandemic levels.

Federal Reserve 

“The combination of easing inflation and a sturdy economy has raised hopes that the Fed can manage a so-called soft landing and tame price increases without tipping the economy into a recession,” according to the AP. 

The Federal Reserve is “squarely focused on our dual mandate to promote maximum employment and stable prices for the American people,” Federal Reserve Chair Jerome Powell said in prepared remarks during a Wednesday press conference.

Although inflation has eased, Powell said that it is not yet low enough for the Fed to lower interest. After increasing interest rates 11 times between March 2022 and July 2023 in an effort to cool inflation, the Fed remains reluctant to make any cuts before inflation reaches a rate of 2% or less.

Powell noted that strong job creation in recent months has been accompanied by an increase in the supply of workers. Additionally, he said, nominal wage growth has been easing, and job vacancies have declined.

“Although the jobs-to-workers gap has narrowed, labor demand still exceeds the supply of available workers,” he said.

Powell hinted that as many as three interest rate reductions may be coming later this year.