In 2024, job search activity has contributed to the increase in unemployment rate. New entrants and re-entrants into the job market have led to a rise in unemployment, while employment levels have remained relatively stable. This indicates that the labor market is experiencing a shift in dynamics rather than a widespread economic downturn.
The 3-month moving average of employment gains fell to 177K, which is the lowest since early 2021. This indicates a relatively soft report, but with some positive aspects such as wage growth and prime-working age employment increase.
The latest report shows that the unemployment rate rose to 4.1%, a 2-1/2-year high, indicating a gradual ebbing in the labor market. However, this increase in unemployment is primarily due to new entrants and re-entrants rather than a rise in layoffs.