US weekly jobless claims at 57-year lows; worker productivity surges in third quarter

WASHINGTON, Nov 5 (Reuters) - The number of Americans filing new claims for unemployment benefits slipped to a 57-year low last week, pointing to labor market resilience, though uncertainty over the drawn-out conflict in the Middle East is constraining hiring.

Other data from the Labor Department on Thursday showed stronger-than-expected growth in worker productivity in the third quarter. The surge in productivity depressed labor costs for the ‌first time in more than a year and reinforced views of policymakers and economists that the labor market was not a source of inflation.

Benign wage inflation gives the Federal Reserve more latitude to focus on ‌rising price pressures stemming from the US-Israeli war with Iran. Anger over the conflict, now in its ninth month, cost President Donald Trump's Republican party control of Congress, with Democrats performing strongly in this week's midterm elections.

Initial claims for state unemployment benefits fell 6,000 to a seasonally adjusted 189,000 for ​the week ended October 31, the Labor Department said. Economists polled by Reuters had forecast 196,000 claims for the latest week.

Claims matched the 189,000 level touched in mid-July, which was the lowest reading since 1969. They have stayed mostly below 200,000 since mid-September. Low layoffs, thanks to strong domestic demand and profit growth, are anchoring the labor market. But some economists viewed the low level of jobless claims as a function of a smaller labor force amid an immigration crackdown, rather than fewer job cuts.

Others believed the labor market could be tightening. The government reported this week that there were 1.06 open jobs for every unemployed person in September, up from 1.02 in August.

No state reported an increase in unadjusted claims in excess of 1,000 last week. A separate ‌report from global outplacement firm Challenger, Gray and Christmas showed US-based employers announced 43,994 ⁠job cuts in October, up 2% from September. Planned layoffs dropped 71% compared to October 2025.

Despite the rise over the month, layoffs were the lowest for any October since 2023. Employers announced plans to hire 444,692 workers last month, a 57% jump from October 2025. Hiring plans were the highest for any October since 2009, and likely mostly seasonal jobs.

"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," said Andy Challenger, chief revenue officer at Challenger, Gray & Christmas. "Companies want the flexibility to meet holiday demand without adding permanent headcount."