Jobless claims inch higher, but still no sign of major U.S. layoffs

By Jeffry Bartash

Economy has a low-hiring, low-firing labor market

The numbers: The number of Americans who applied for unemployment benefits last week rose slightly to a minuscule 225,000, confirming that layoffs remain surprisingly low even though many companies have pulled the plug on hiring.

New claims climbed to 225,000 in the seven days that ended Sept. 28, up from 219,000 in the prior week, the government said Thursday.

The low level of layoffs has kept the unemployment rate from rising all that much despite a big slowdown in hiring.

Businesses are mainly letting positions go unfilled after workers change jobs, retire or leave for other reasons.

Economists polled by the Wall Street Journal had forecast new claims to total 220,000, based on seasonally adjusted figures.

Key details: Once again, the number of new claims looked even better based on actual filings - that is, before seasonal adjustments.

Raw claims fell to 180,647 last week from 181,713 two weeks ago. They've held below 200,000 for eight straight weeks - a rarely occurring streak.

New jobless claims fell in 28 of the 53 states and territories that report these figures to the federal government, while 25 showed relatively small increases.

The number of people already collecting unemployment benefits in the U.S., meanwhile, was basically unchanged at 1.83 million, the government said.

These so-called continuing claims have increased gradually in the past year, because it's taking longer for people who lose a job to find another one.

One caveat: Hurricane Helene could lead to an increase in unemployment filings soon, once the government reaches the tens of thousands of people whose homes and workplaces were damaged or destroyed.

Big picture: The U.S. is experiencing an unusual low-hiring, low-firing environment that likely cannot last.

Yet with the Federal Reserve now cutting interest rates, hiring is likely to pick up again next year as lower borrowing costs spur the economy.

Looking ahead: "We do not see any signs here that are particularly worrisome for the labor market," said Thomas Simons, U.S. economist at Jefferies LLC.

Market reaction: The Dow Jones Industrial Average DJIA and the S&P 500 SPX were set to open lower in Thursday trading.

-Jeffry Bartash

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10-03-24 0931ET

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