U.S. weekly jobless claims fall to near 57-year lows; layoffs drop in September

New applications for U.S. unemployment benefits fell last week and layoffs decreased in September, suggesting that labour market stability persisted even as employers remained cautious about boosting hiring.

Initial claims for state unemployment benefits slipped 1,000 to a seasonally adjusted 197,000 for the week ended Sept. 26, the Labor Department said on Thursday. Economists polled by Reuters had forecast 200,000 claims for the latest week.

Claims are near 57-year lows, despite growing headwinds from the U.S.-Israeli war with Iran, which is driving up energy prices. Diesel prices are at record highs. Economists said robust corporate profits growth and resilient domestic demand were shielding workers from layoffs.

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A separate report from global outplacement firm Challenger, Gray & Christmas showed planned layoffs by U.S.-based employers dropped 18 per cent to 43,281 in September. Announced job cuts were down 20 per cent from a year ago. So far this year, employers have announced 573,195 layoffs, down 39 per cent compared to the first nine months of 2025. Planned job cuts fell 43 per cent in the third quarter.

Employers are, however, in no rush to increase head count. Hiring plans increased by 90,787 last month. While that was sharply up from 12,325 in August, hiring intentions were down 23 per cent from a year ago, and the tally was the lowest for any September since 2011.

Challenger, Gray & Christmas said a surge in seasonal hiring usually seen starting in September was absent.

“Companies are in a wait-and-see period right now,” said Andy Challenger, chief revenue officer at Challenger, Gray & Christmas. “Employers are facing high energy costs, an uncertain war in Iran, a rate hike that could make hiring more expensive, plus the likelihood of surging healthcare costs.”

The Federal Reserve last month raised its overnight benchmark interest rate by 25 basis points to the 3.75-to-4.00-per-cent range, the first hike in three years, and flagged further increases in borrowing costs in the months ahead.

U.S. consumer confidence sinks to lowest level since 2014, survey finds

The claims report showed the number of people receiving unemployment benefits after an initial week of aid, a proxy for hiring, dropped 11,000 to a seasonally adjusted 1.701 million during the week ended September 19. Though the so-called continuing claims are in the lower end of their range for this year, some people who have lost their jobs are experiencing long spells of unemployment.

A survey from the Conference Board on Tuesday showed the share of consumers saying jobs were “plentiful” dropped in September to the lowest level since February, 2021, while the proportion who viewed jobs as “hard to get” was the highest in more than 5-1/2 years.

The claims data have no bearing on September’s employment report as they fall outside the survey period. Nonfarm payrolls likely increased by 90,000 jobs last month after advancing 162,000 in August, a Reuters survey of economists showed. The unemployment rate is forecast holding steady at 4.1 per cent for a third straight month, though risks are tilted to the upside.