U.S. Jobless Claims Rise to 235,000 While Layoffs Stay Historically Low

U.S. Jobless Claims Rise Slightly, But Layoffs Remain Historically Low

Trump’s labor policies and slowing hiring momentum continue to weigh on U.S. employment data, even as layoffs remain within a historically low range.

According to the U.S. Labor Department, 235,000 Americans filed for unemployment benefits in the week ending August 16, an increase of 11,000 from the previous week and slightly above economist projections of 229,000.

Weekly jobless claims — often seen as a proxy for layoffs — have largely stayed within a range of 200,000 to 250,000 since the U.S. began recovering from the pandemic more than three years ago.

Signs of Weakness Emerge in Broader Labor Market

Despite low layoffs, the labor market is showing cracks. In July, U.S. employers added just 73,000 jobs, well below the expected 115,000. Revisions to May and June further reduced job gains by 258,000 positions. The unemployment rate also edged up to 4.2% from 4.1%.

The disappointing report triggered a political storm: President Donald Trump responded by firing Erika McEntarfer, head of the Bureau of Labor Statistics (BLS) — the agency responsible for monthly job numbers. However, the BLS does not produce weekly unemployment claims data; it only adjusts for seasonality.

Earlier this week, the BLS reported that Washington, D.C.’s unemployment rate exceeded 6% for the third month in a row — the highest in the country. Analysts attribute this spike to mass federal layoffs initiated by Trump’s Department of Government Efficiency, as well as declines in international tourism, a key driver of the local economy.

Regional and Sectoral Impact Expands

Unemployment also increased in neighboring Maryland and Virginia, where many federal employees reside.

Since the start of Trump’s second term, federal agencies have seen widespread layoffs and forced resignations, sparking multiple legal challenges from unions and advocacy groups.

Job openings also declined: the number of vacant positions fell to 7.4 million in June, down from 7.7 million in May. Meanwhile, the quit rate — typically a sign of worker confidence — dropped to its lowest level since December.

Major employers announcing layoffs this year include Starbucks, Microsoft, Meta, CNN, Southwest Airlines, Disney, Procter & Gamble, Dow, Google, and Intel.

Economists point to Trump’s unpredictable trade policies and tariffs as a source of uncertainty, discouraging businesses from expanding hiring.

The four-week average of jobless claims, a more stable indicator, rose by 4,500 to 226,500. Total continuing claims increased by 30,000, reaching 1.97 million — the highest since November 6, 2021.