Jobless claims sink to 3-year low in no-hire, no-fire U.S. economy

By Jeffry Bartash

Drop in unemployment filings likely exaggerated by Thanksgiving holiday

Among those who have been laid off in recent months are some federal employees.

The number of people who applied for unemployment benefits around the Thanksgiving holiday fell to a more than three-year low, reinforcing the view that businesses are mostly avoiding layoffs even as they freeze hiring.

The drop in new claims last week was likely exaggerated by Thanksgiving. Lots of people who lose jobs around a holiday tend to delay filling out their applications.

Still, the number of people losing jobs each week and applying for benefits remains very low historically.

So-called initial jobless claims sank by 27,000 to 191,000 in the seven days that ended Nov. 29, down from a revised 218,000 in the prior week, the government said Thursday. It's the lowest reading since September 2022.

Key details: The number of people already collecting unemployment benefits - known as continuing claims - fell slightly, to 1.94 million.

These claims sit near a postpandemic high, however, in a sign of how much harder it has gotten to find a job.

Big picture: The job market has turned chilly, and it's unlikely to thaw out anytime soon.

The big question is how the Federal Reserve will react to a recent slew of information on the labor market when it meets next week to decide whether to cut interest rates again.

Top Fed officials will be comforted by the low level of layoffs, but hiring has come to a standstill and the economy might even be losing net jobs. The central bank has cut rates twice since September because it was worried about rising unemployment.

Looking ahead: "The latest week for claims data included the Thanksgiving holiday, and holidays often distort claims data, so this release should be taken with a big grain of salt," said Bill Adams, chief economist at Comerica Bank. "Even so, the recent trend looks good."

Market reaction: The Dow Jones Industrial Average DJIA and S&P 500 SPX fell slightly in Thursday trading.

-Jeffry Bartash

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

12-04-25 1015ET