Jobless Claims Fall to 189,000, a 57-Year Low, as Q3 Productivity Surges 3.6%

U.S. weekly jobless claims fell to a 57-year low last week while third-quarter worker productivity surged, offering a cooler inflation signal ahead of Friday’s payrolls report.

Initial claims dropped 6,000 to 189,000 for the week ended Oct. 31, matching the mid-July low and the lowest reading since 1969, Reuters reported.

Economists surveyed for that report had forecast 196,000 claims.

Continuing claims rose 23,000 to 1.718 million for the week ended Oct. 24.

The four-week moving average stood at 194,750, Capital Finance Bureau summarized from Labor Department data.

The claims figures are compiled by the Labor Department and remain a closely watched weekly gauge of layoff activity.

Challenger, Gray & Christmas said employers announced 43,994 October job cuts, up 2% from September but down 71% from a year earlier, the lowest October total since 2023, Reuters reported.

Hiring plans jumped 57% year over year to 444,692, the highest October figure since 2009, though Challenger said the gains were mostly seasonal.

“Employers are holding on to the workers they have heading into the holidays, and the hiring they are announcing is largely short-term, seasonal work,” Andy Challenger said.

Productivity Jumps, Unit Labor Costs Fall

Nonfarm business productivity rose at a 3.6% annualized rate in the third quarter, beating a 2.8% forecast, Reuters reported from Bureau of Labor Statistics data.

Second-quarter productivity was revised to a 2.1% gain, and productivity was up 2.1% from a year earlier.

Unit labor costs fell 0.7% in the third quarter, the first decline since the second quarter of 2025 and well below a 0.6% rise that economists expected.

From a year earlier, unit labor costs were up 2.4%.

Stephen Stanley of Santander told Reuters that artificial intelligence has yet to make a noticeable contribution and that pandemic-era improvisations have yielded lasting efficiency gains.

Sal Guatieri of BMO said the productivity surge and subdued unit labor costs should give the Federal Reserve comfort on the inflation outlook.

Friday’s nonfarm payrolls report is expected to show about 65,000 jobs added, with the unemployment rate near 4.2%.

Taken together, soft claims and stronger productivity paint a labor market that is cooling without a sharp rise in layoffs.

That mix can support the case that wage pressures are easing even as employers keep existing workers on payrolls into the holiday season.

A low level of new claims also suggests fewer workers are being forced into the jobless rolls even as companies trim hiring plans outside seasonal roles.

Lower unit labor costs can ease pressure on consumer prices if the productivity gains hold into the fourth quarter.

October’s Challenger cut tally remaining near multiyear lows reinforces the message from weekly claims that layoffs are still scarce.

Markets will parse whether Friday’s payrolls confirm the claims signal or revive concerns about a sharper hiring slowdown.

Content created by Conservative Daily News and some content syndicated through CDN is available for re-publication without charge under the Creative Commons license. Visit our syndication page for details and requirements.