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U.S. applications for unemployment benefits fell to their lowest level in more than three years last week, potentially complicating the Federal Reserve’s upcoming decision on interest rates.
The number of Americans applying for jobless benefits for the week ending Nov. 29 fell to 191,000 from the previous week’s 218,000, the Labor Department reported Thursday. That’s the lowest level since September 24, 2022, when claims came in at 189,000. Analysts surveyed by data provider FactSet had forecast initial claims of 221,000.
Applications for unemployment aid are viewed as a proxy for layoffs and are close to a real-time indicator of the health of the job market. The job cuts announced recently by large companies such as UPS, General Motors, Amazon and Verizon typically take weeks or months to fully implement and may not be reflected in Thursday’s data.
For now, the U.S. job market appears stuck in a “low-hire, low-fire” state that has kept the unemployment rate historically low, but has left those out of work struggling to find a new job.
On Wednesday, private payroll data firm ADP estimated U.S. job losses of 32,000 in November. The surprisingly weak report may be discouraging for people looking for jobs, but it bolstered expectations that the Fed will cut its main interest rate next week.
