US jobs market showing cracks as corporate profits drop, layoffs creep up

The number of Americans filing new applications for jobless benefits increased more than expected last week and the unemployment rate appeared to have picked up in May, suggesting layoffs were rising as tariffs cloud the economic outlook.

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WASHINGTON - The number of Americans filing new applications for jobless benefits increased more than expected last week and the unemployment rate appeared to have picked up in May, suggesting layoffs were rising as tariffs cloud the economic outlook.

The report from the Labour Department on May 29 showed a surge in applications in Michigan, the nation's motor vehicle assembly hub. The automobile industry has been hit with a 25 per cent duty on parts.

The number of people collecting unemployment cheques in mid-May was the largest in 3 1/2 years. Initial claims for state unemployment benefits rose by 14,000 to a seasonally adjusted 240,000 for the week ended May 24, the Labour Department said. Economists polled by Reuters had forecast 230,000 claims for the latest week.

They said US President Donald Trump's aggressive trade policy was making it harder for businesses to plan ahead, a sentiment echoed by a Conference Board survey on May 29, which showed confidence among chief executives plummeting in the second quarter.