Job seekers attend a job fair in Los Angeles.
Applications for U.S. unemployment benefits fell last week to the lowest in more than three years, indicating that employers are still largely holding onto workers despite a wave of recent layoff announcements.
Initial claims decreased by 27,000, to 191,000, in the week that ended November 29, a period that included Thanksgiving. The weekly claims data can be particularly choppy around holidays. The figure was below all estimates in a Bloomberg survey of economists.
The four-week moving average of new applications, a metric that helps smooth out volatility, fell to 214,750 last week. That’s the lowest since January, according to Labor Department data released today.
“Initial claims can be subject to big swings at this time of year, so we won’t read too much into one week’s number,” Nancy Vanden Houten, lead economist at Oxford Economics, said in a note. “Still, initial claims have remained in a range consistent with a relatively low pace of job losses despite recent layoff announcements.”
Many employers have sharply pulled back on hiring in recent months, and some large corporations—including HP Inc. and FedEx Corp.—have announced job cuts. Even so, today’s data suggests that layoffs remain limited, helping to allay concerns about a rapid deterioration in the labor market.
Meanwhile, continuing unemployment claims—a proxy for the number of people receiving benefits—retreated to 1.94 million in the week ended November 22, near the highest level since 2021. The low-hire, low-fire job market has kept a lid on initial applications for unemployment benefits, but has also limited out-of-work Americans’ ability to find a new job.
U.S. companies shed payrolls in November by the most in more than two years, driven by small businesses, according to ADP Research data released yesterday. That report, alongside the weekly claims figures, will help inform Federal Reserve officials as they decide whether to lower interest rates for a third straight meeting next week.
Separate data out today from Challenger, Gray & Christmas showed that announced layoffs at U.S. companies settled back last month after an October surge, but were still the highest for any November in three years. A metric of non-farm employment from Revelio Labs declined in November, marking the fifth drop in the past seven months.
Policymakers will not yet have the government’s November jobs report in hand for their next meeting. The report, originally due December 5, was delayed until December 16 as a result of the record-long government shutdown. That release will also include October payrolls figures.
Before adjusting for seasonal factors, initial jobless claims also fell last week. California accounted for nearly half of the total drop in applications, followed by Texas and New York.
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