Jobless claims dip to 197,000 as layoffs stay near historic lows
Fewer Americans applied for unemployment benefits last week, with claims slipping 2,000 to 197,000, the Labor Department said Thursday. For workers, that means layoffs remain rare even as hiring has slowed sharply. Claims have stayed below 200,000 since the second week of September, near the lowest levels in 57 years.
The number of Americans filing new claims for unemployment benefits fell slightly last week, pointing to a labor market where most workers still feel secure. Initial claims slipped 2,000 to a seasonally adjusted 197,000 for the week ended Oct. 3, the Labor Department said Thursday. Economists polled by Reuters had expected 200,000.
Claims are a stand-in for layoffs, so the report is good news for people who already have jobs. The four-week average, which smooths out bumps from week to week, fell 2,500 to 198,000. That is its lowest level since early October 2022, Reuters reported.
Claims have now stayed below 200,000 since the second week of September, and The Wall Street Journal counted a fifth straight weekly decline.
The flip side is that companies are slow to hire new workers. Employers added just 29,000 jobs in September, down from 133,000 in August, the AP reported, and the unemployment rate ticked up to 4.2%.
"It's still a 'low-hire, low-fire' job market," Heather Long, chief economist at Navy Federal Credit Union, told Reuters. "That's great for anyone who has a job and wants to keep it, but it's tough for job seekers."
People who lose work are staying jobless longer, because openings are harder to find. The median stretch of unemployment hit 11.5 weeks in September, near a four-and-a-half-year high, and the number of people still collecting benefits after their first week rose 17,000 to 1.716 million.
The numbers clash with how many voters feel. Layoffs are at "extremely low levels" even as many Americans stay gloomy about the economy less than a month before the Nov. 3 midterms, The Washington Post reported. Economists blame slow hiring on uncertainty from tariffs and the U.S.-Israeli war with Iran, Reuters reported.
The Federal Reserve is watching the same numbers. It raised its key interest rate in September for the first time in three years, and economists expect another increase in December.
What we know: Layoffs remain very low, and claims sit below 200,000.
What we don't: Whether slow hiring will push the jobless rate higher.
Where outlets agree AP, Reuters and The Wall Street Journal all report that initial jobless claims fell 2,000 to 197,000 in the week ended Oct. 3.
Where they differ AP says the report shows most companies are confident enough to keep their workers, while Pantheon Macroeconomics' Samuel Tombs, quoted by Reuters, expects weak hiring to push the unemployment rate gently higher.