US weekly jobless claims fall; layoffs drop in September

• Initial unemployment claims declined by 1,000 to 197,000, below the forecasted 200,000, maintaining levels near historic lows despite economic headwinds
• Year-to-date layoffs totaled 573,195, down 39% compared to the first nine months of 2025, with third quarter job cuts falling 43%
• Hiring intentions remain weak, down 23% year-over-year, with the September tally the lowest since 2011 as companies adopt a 'wait-and-see' approach due to high energy costs, the US-Israeli war with Iran, and Federal Reserve rate hikes

US Weekly Jobless Claims Fall; Layoffs Drop in September

Key Employment Figures:

Initial unemployment claims declined by 1,000 to a seasonally adjusted 197,000 for the week ended September 26, beating economist forecasts of 200,000. Claims remain near 57-year lows despite economic headwinds. Continuing claims fell 11,000 to 1.701 million during the week ended September 19.

Layoff Data:

Challenger, Gray & Christmas reported planned layoffs by US employers dropped 18% to 43,281 in September, down 20% year-over-year. Year-to-date layoffs totaled 573,195, representing a 39% decrease compared to the first nine months of 2025. Third-quarter job cuts fell 43%.

Hiring Trends:

While hiring plans increased to 90,787 in September from 12,325 in August, hiring intentions remain down 23% year-over-year—the lowest September level since 2011. The typical seasonal hiring surge is notably absent, indicating employer caution.

Market Context:

Labor market stability persists despite multiple headwinds: the US-Israeli conflict with Iran driving energy prices to record highs, particularly diesel fuel. The Federal Reserve recently raised its benchmark rate by 25 basis points to 3.75%-4.00%, the first increase in three years, with additional hikes anticipated.

Outlook:

Employers remain in "wait-and-see" mode due to high energy costs, geopolitical uncertainty, rising borrowing costs, and expected healthcare cost increases. Economists forecast September nonfarm payrolls increased by 90,000 jobs, down from August's 162,000 gain, with unemployment holding steady at 4.1%.

Implication: The data suggests a resilient but cautious labor market, with strong job retention but limited expansion plans amid economic uncertainty.