U.S. filings for unemployment benefits dipped slightly last week, signaling that layoffs remain contained even as broader labor market indicators point to a slower pace of hiring. Initial jobless claims for the week ended March 7 fell by 1,000 to 213,000, the Labor Department said Thursday. Economists surveyed by FactSet had expected 215,000.
Weekly claims are closely watched as a near real-time gauge of layoffs. The latest reading keeps claims near the lower end of the range seen over the last few years, when filings have largely held between 200,000 and 250,000.
Layoffs Stay Low, But Cuts Keep Making Headlines
Despite the stable claims data, a series of large employers has announced job reductions in recent weeks, keeping concerns about corporate cost-cutting in focus. The report cited layoffs disclosed by firms including Morgan Stanley, Block, UPS and Amazon.
The Labor Department also reported that the four-week moving average of claims, which smooths weekly volatility, declined by 4,000 to 212,000. That measure can offer a clearer read on trend conditions when individual weeks are affected by seasonal factors or reporting noise.
Hiring Weakness Shows Up Elsewhere
The steadiness in claims contrasts with other recent signals of a softer jobs backdrop. Last week, the government said employers unexpectedly cut 92,000 jobs in February, while revised data removed a combined 69,000 jobs from December and January. The unemployment rate ticked up to 4.4%.
Separately, official data showed job openings fell in December to the lowest level in more than five years. The next update to that series is due next week, a release investors often use to evaluate whether labor demand is stabilizing or continuing to cool.
Inflation and the Iran War Add New Uncertainty
Economists often describe the current environment as “low-hire, low-fire.” Companies are not laying off aggressively, but the pace of hiring has slowed enough that unemployed workers can face longer searches for a new role.
Policy uncertainty has added another layer of risk. Tariff-related concerns and the legacy effects of higher interest rates from 2022 and 2023 have weighed on business confidence, while the war involving Iran has pushed oil prices sharply higher. The report noted oil prices are up about 25% in less than two weeks, a move that can filter into transportation and consumer costs.
Inflation remains above the Federal Reserve’s target even before the latest energy shock. The consumer price index showed prices were 2.4% higher in February than a year earlier, matching the prior month and coming in below expectations. Investors are now watching whether higher gasoline prices in March change the near-term inflation path.
Continuing Claims Fall as Fed Meeting Nears
The total number of people receiving unemployment benefits for the prior week ended Feb. 28 fell by 21,000 to 1.85 million. That measure, often called continuing claims, can provide clues about how quickly displaced workers are finding new jobs.
Attention is also shifting to upcoming inflation data and the Federal Reserve’s next rate decision. The Fed’s preferred inflation gauge, the personal consumption expenditures price index, is due Friday, just ahead of the central bank’s policy meeting, where officials will weigh how cooling hiring, sticky inflation, and higher energy costs interact in the months ahead.