New applications for U.S. unemployment benefits remained below 200,000 for a fifth consecutive week, reinforcing evidence that American employers continue to avoid large-scale layoffs despite slower hiring.
Initial jobless claims increased by 1,000 to a seasonally adjusted 199,000 during the week ended October 10, according to the U.S. Department of Labor. The previous week’s figure was revised upward to 198,000.
The four-week moving average increased slightly to 198,500.
Continuing claims, reported with a one-week lag, declined by 4,000 to 1.71 million during the week ended October 3. The insured unemployment rate remained unchanged at 1.1%.
The figures reinforce an unusual pattern in the U.S. labor market: companies are hiring cautiously but are also showing little appetite for widespread layoffs.
That combination has produced a relatively stable employment environment despite high borrowing costs and uncertainty surrounding economic growth.
The numbers matter for Federal Reserve policy because policymakers are balancing inflation risks against the possibility that restrictive monetary conditions could significantly weaken employment.
A sharp increase in unemployment claims would provide evidence of greater labor-market deterioration. Instead, claims remain historically low, complicating the case for aggressive monetary easing if inflation pressures persist.
Investors will now watch upcoming payroll, unemployment and inflation reports for evidence that the labor market is either stabilizing at current levels or beginning to weaken more materially.
