Weekly unemployment insurance claims in the U.S. dropped to 194,000 for the week ending October 17, the Labor Department reported Thursday, marking the lowest level since the late 1960s. The four-week moving average of claims also fell to 197,750, continuing a trend of historically low layoffs.
Initial filings for unemployment benefits declined from 200,000 the prior week, according to the Labor Department’s seasonally adjusted data. This decline follows a broader pattern of minimal job cuts, with layoffs falling by 61,000 in August, as reported by the Bureau of Labor Statistics on September 29. Over the past 12 months, the layoff rate as a share of the total workforce decreased to 1%, down from 1.2% in the prior period.
The labor market’s stability contrasts with concerns raised in consumer confidence surveys and media reports about job cuts and the impact of artificial intelligence. Thomas Simons, chief U.S. economist at Jefferies, noted in a client note that despite these perceptions, the claims data suggests labor market conditions remain stable.
Hiring remains sluggish, with nonfarm payrolls rising by just 29,000 in September and averaging 69,000 jobs added per month in 2026, according to Labor Department figures. The unemployment rate increased to 4.2% in September, primarily due to a rise in labor force participation. Job openings have remained relatively flat over the same period.
Economists describe the current job market as a “low-hire, low-fire” environment, where employers are retaining workers despite weak hiring trends. The average monthly job creation of 68,000 so far in 2026 reflects an improvement from 2025, when hiring averaged just 9,700 jobs per month amid high interest rates and trade policy uncertainty. However, this pace lags behind the 166,000 monthly jobs added on average in 2023 and 2024, and the 491,000 monthly gains recorded during the 2021-2022 post-pandemic hiring boom.
Federal Reserve officials are scheduled to meet next week to assess interest rate policy, with recent statements emphasizing the labor market’s strength while focusing on inflation concerns. The next jobs report, based on the same reference week as the claims data, is set for release on November 5.