Applications for US jobless benefits fall to 2-month low as layoffs remain at healthy levels

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The number of Americans filing for unemployment benefits fell to its lowest level in two months last week, signaling that layoffs remain relatively low despite other signs of labor market cooling

The number of Americans filing for unemployment benefits fell to its lowest level in two months last week, signaling that layoffs remain relatively low despite other signs of labor market cooling.

Jobless claims fell by 5,000 to 227,000 for the week of Aug. 31, the Labor Department reported Thursday. That’s the fewest since the week of July 6, when 223,000 Americans filed claims. It's also less than the 230,000 new filings that analysts were expecting.

The four-week average of claims, which evens out some of the week-to-week volatility, fell by 1,750 to 230,000. That's the lowest four-week average since early June.

Weekly filings for unemployment benefits, considered a proxy for layoffs, remain low by historic standards, though they are up from earlier this year.

During the first four months of 2024, claims averaged a historically low 213,000 a week. But they started rising in May. They hit 250,000 in late July, adding to evidence that high interest rates were finally cooling a red-hot U.S. job market.

Employers added just 114,000 jobs in July, well below the January-June monthly average of nearly 218,000. The unemployment rate rose for the fourth straight month in July, though it remains relatively low at 4.3%.

Economists polled by FactSet expect Friday’s August jobs report to show that the U.S. added 160,000 jobs, up from 114,000 in July, and that the unemployment rate dipped to 4.2% from 4.3%. The report’s strength, or weakness, will likely influence the Federal Reserve’s plans for how much to cut its benchmark interest