Initial US jobless claims tick up slightly as layoffs stay low

what happened

Fewer Americans than expected applied for jobless benefits last week, although the figure edged higher. Seasonally adjusted initial claims rose by 1,000 to 199,000 for the period ending October 10, according to the Labor Department, which released the data on Thursday. Analysts surveyed by Reuters had expected 200,000.

This marked the fifth consecutive week in which claims stayed under the 200,000 mark, a pattern economists describe as a "low-hire, low-fire" market. The Fed's Beige Book, published Wednesday, described employment as little changed from late August to early October, with enough workers available, though skilled trades remain scarce. Five districts also reported that some firms cut headcount through attrition, held off on hiring, or expected less job creation after adopting AI to boost productivity.

Continuing claims fell by 4,000 to a seasonally adjusted 1.710 million in the week ending October 3, a sign that rehiring is slow. That figure leaves out recent college graduates and others with too little work history to qualify. Many long-term jobless workers have likely used up their benefits, which in most states are capped at 26 weeks. The median duration of unemployment reached 11.5 weeks in September, close to a four-and-a-half-year high, while the jobless rate stood at 4.2% last month.

why it matters

Low layoffs are keeping the labor market steady, but weak hiring, tariff pressures and price increases linked to the US-Israeli war with Iran add uncertainty. For the dollar and Treasuries, a stable jobs picture alongside fresh data showing an inflation jump may keep the Fed cautious about rate cuts.

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