U.S. Jobless Claims Fall to 194,000, Below Forecasts for the Week
Key Facts
Initial claims for unemployment benefits in the United States fell to 194,000 in the week ended October 24, down 1,000 from the prior week after revision, according to the U.S. Department of Labor. The reading was below the 199,000 claims forecast by economists polled by Reuters. The department raised its reading for the week ended October 17 from 194,000 to 195,000 claims. The weekly decline is therefore measured against the revised figure, not the number first reported. The latest reading shows layoffs remain limited, but on its own does not mean employers are expanding hiring.
Claims have mostly remained below 200,000 since mid-September, Reuters reported, nearing a previous low of 189,000 in mid-July. That was the lowest reading since 1969, making the current figure close to a historic low without being the low itself. The Associated Press also said claims had been at 200,000 or below for seven consecutive weeks through October 29. Claims have not exceeded 230,000 in any week since the start of the year, according to the agency. These levels place the labor market in a context of low layoffs, while the pace of hiring remains under scrutiny.
The four-week average of claims fell to 196,750 in the week ended October 24, down 1,250 from the prior week's average, revised to 198,000, according to the Department of Labor. The moving average dampens the effect of weekly fluctuations, and its reading confirms a decline in claims compared with the previous period. Continuing claims, which are used as a rough indicator of employment, fell by 21,000 to 1,701,000 in the week ended October 17, Reuters reported. The insured unemployment rate was 1.1% that week, unchanged from the prior week, according to the Department of Labor. In the comparable week a year earlier, initial claims stood at 221,000, compared with 194,000 in the current reading.
Economists described the labor market as being in a state of "low hiring and low firing," Reuters reported. The agency said strong corporate profits and resilient domestic demand are keeping layoffs near historically low levels. But companies are reluctant to increase hiring amid the U.S.-Israeli war with Iran, according to the same source. This picture shows that low jobless claims reflect the layoff side of the labor market, while they are not enough on their own to judge the strength of new hiring. The Associated Press reported that employers added an average of 68,000 jobs a month during 2026 through the time of its report, after adding 29,000 jobs in the previous month. The average monthly gain in 2025 was about 9,700 jobs.
The claims reading coincided with data showing real gross domestic product grew at an annual rate of 3.4% in the third quarter, according to the U.S. Bureau of Economic Analysis' advance estimate. Growth had been 2.2% in the second quarter. The bureau attributed the increase to higher investment, consumer spending and government spending, with a decline in exports limiting the gain. Real final sales to private domestic purchasers rose 4.9% in the third quarter, compared with 4.6% in the second quarter. These figures reflect the strength of domestic demand during the same period that weekly claims remained low.
In September data, nominal personal consumption expenditures rose 0.5% month over month, after increasing 0.9% in August, while real spending was unchanged after rising 0.5% in the prior month, according to the Bureau of Economic Analysis. The personal consumption expenditures price index rose 0.5% from the previous month and 3.6% from a year earlier. The core index, excluding food and energy, recorded an annual increase of 3.1%. The second estimate of third-quarter gross domestic product and corporate profits is scheduled for release on November 25, 2026, at 8:30 a.m. Eastern time. The Department of Labor was also scheduled to release October employment data on November 6, with a FactSet survey forecasting the addition of 55,000 jobs during the month.