US unemployment claims tick up to 206,000 but remain at historically low levels

More Americans filed for unemployment benefits last week, but layoffs remain rare and jobless claims continue to hover at historically low levels.

The Labor Department reported Thursday that filings for benefits ticked up to 206,000 last week from a revised 204,000 the week before. The four-week average of claims, which smooths out week-to-week volatility, rose modestly to 207,250 last week.

Claims for jobless benefits are a proxy for layoffs, and economists watch them because they can offer a signal of where the job market is headed. For the past year, claims have mostly stayed within a historically low range of 200,000 to 230,000 a week.

Companies, remembering the worker shortages that followed the end of COVID-19 lockdowns, are still reluctant to let go of staff. The unemployment rate is low at 4.1%.

But employers aren’t eager to take on new workers. The Labor Department reported Tuesday that gross hiring — before subtracting people who lost or left their jobs — fell 5% to fewer than 5.1 million new jobs. The result is what economists call a “no-hire, no-fire” labour market, in which those who have work enjoy job security, but times are tough for young workers trying to land an entry-level job or unemployed people seeking to get back to work.

In July, companies, government agencies and nonprofits together cut 23,000 jobs. So far this year, employers are adding 61,000 jobs a month, up from the 9,700 they averaged last year — the weakest hiring outside a recession since 2002. The lingering effects of high interest rates and President Donald Trump’s erratic trade policies discouraged companies from hiring in 2025.

When the Labor Department releases its report on last month’s hiring and unemployment on Friday, it is expected to show that employers added 65,000 jobs in August and that the unemployment rate ticked up to 4.2%, according to a survey of forecasters by data firm FactSet.

Hiring this year remains well below the 166,000 monthly jobs created, on average, in 2023 and 2024, let alone the 491,000 a month recorded during the 2021-2022 hiring boom that followed pandemic lockdowns.