US jobless claims fell to 194,000 last week, lowest since July

WASHINGTON (AP) — U.S. unemployment claims fell to 194,000 last week, the fewest in three months and another sign that layoffs remain low and most Americans enjoy extraordinary job security.

The Labor Department reported that claims were down from 200,000 the week before.

Applications for jobless benefits are a proxy for layoffs, and economists watch them closely because they can provide signs of where the job market is headed. So far this year, claims have remained at historically low levels, never topping 230,000 in a single week.

The four-week average of claims, which strips out week-to-week ups and downs, dipped to 197,750.

The American job market has remained sturdy despite higher energy prices that have squeezed businesses and consumers since the fighting with Iran began Feb. 28. Most companies are confident enough in the economy and their sales to hold onto workers. At the same time, hiring has been sluggish, resulting in a “low-hire, low-fire” job market. Last month, the unemployment rate ticked up to a still-low 4.2%.

So far this year, employers — companies, government agencies and nonprofits — have been adding an average of 68,000 jobs a month. That is an improvement on a lackluster 2025 when monthly job creation averaged 9,700 as high interest rates and President Donald Trump’s unpredictable trade policies discouraged hiring.

Hiring remains well below the 166,000 monthly jobs created, on average, in 2023 and 2024, and the 491,000 a month recorded during the 2021-2022 hiring boom that followed COVID-19 lockdowns.