U.S. labor markets showed signs of weakening as initial jobless claims unexpectedly rose to 240,000 for the week ending May 24, surpassing forecasts of 230,000. The increase comes amid growing uncertainty over U.S. trade policy after a federal court ruled the Trump administration’s sweeping tariffs illegal.
The uptick in unemployment filings suggests businesses may be scaling back hiring as trade tensions cloud the economic outlook. Sectors most exposed to tariffs, including manufacturing and logistics, appear to be leading the job cuts. The data follows recent surveys showing declining export orders, indicating trade disputes are beginning to impact employment decisions.
With the Biden administration yet to clarify its tariff strategy following the court’s decision, businesses face continued uncertainty. The May jobs report will provide further evidence of whether this marks the start of a broader labor market slowdown or temporary volatility. Analysts warn prolonged trade policy confusion could further dampen hiring and investment plans across tariff-sensitive industries.
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