U.S. unemployment claims dropped to their lowest level in over three years during the week of Thanksgiving, signaling a surprisingly resilient job market despite recent high-profile layoffs.
According to The Associated Press, the Labor Department reported Thursday that 191,000 Americans filed for jobless benefits for the week ending Nov. 29, down from 218,000 the previous week.
The figure is the lowest since Sept. 24, 2022, when claims totaled 189,000. Analysts had predicted 221,000 initial claims, according to FactSet.
Kathy Bostjancic, chief economist at Nationwide, cautioned that holiday weeks often skew unemployment data, as some workers may delay filing claims around Thanksgiving. Still, she noted, the low numbers indicate that widespread layoffs remain limited.
“The labor market is kind of frozen,” Bostjancic said. “Companies are in wait-and-see mode.”
Recent announcements of job cuts by major companies, including Amazon, UPS, General Motors, and Verizon, may not yet be reflected in the weekly data. These layoffs can take weeks or months to materialize in official statistics.
Applications for unemployment aid serve as a near real-time gauge of labor market health. Currently, the U.S. market appears trapped in a “low-hire, low-fire” cycle, keeping the unemployment rate historically low despite sluggish hiring.
Private payroll firm ADP estimated a loss of 32,000 jobs in November, adding to a mixed labor picture.
While job seekers may find hiring slow, analysts suggest the data could encourage the Federal Reserve to cut its main interest rate at its upcoming meeting. Inflation, however, remains above the Fed’s 2% target, and Friday’s report on the central bank’s preferred measure will factor into any rate decision.
Thursday’s report also showed the four-week moving average of claims fell 9,500 to 214,750, smoothing out week-to-week fluctuations. Total claims for the previous week, ending Nov. 22, dipped by 4,000 to 1.94 million.
Economists say the combination of slowing inflation, modest job growth, and resilient unemployment claims has financial markets increasingly expecting a Fed rate reduction next week—the third cut of 2025—as the central bank navigates a cooling but stable economy.
