US labour market enters 2026 on weaker footing as claims rise

The variety of Individuals submitting new purposes for unemployment advantages rose modestly final week, pointing to low ranges of layoffs however continued weak point in hiring as employers stay cautious amid tariff-related uncertainty and the rising adoption of synthetic intelligence.

Preliminary claims for state unemployment advantages elevated by 8,000 to a seasonally adjusted 208,000 for the week ended December 27, in keeping with knowledge launched by the US Labor Division on Thursday. Economists polled by Reuters had anticipated claims to rise to 210,000.
The info confirmed that job cuts stay low by historic requirements, though claims have been risky in current weeks as a result of seasonal adjustment challenges across the year-end vacation interval.

Employers have been reluctant to broaden headcount, citing coverage uncertainty and speedy technological shifts, however have additionally averted large-scale layoffs—leaving the labour market in what analysts describe as a state of paralysis.

Hiring plans fell 34 per cent to 507,647 in 2025, the bottom stage since 2010, elevating considerations that unemployed staff could face longer spells with out work. The variety of individuals persevering with to obtain unemployment advantages—a proxy for hiring — rose by 56,000 to 1.914 million within the week ended December 20.

Separate authorities knowledge launched on Wednesday confirmed job openings fell to a 14-month low in November, with simply 0.91 vacancies for each unemployed particular person, the bottom ratio since March 2021.

Economists count on non-farm payrolls to have risen by round 60,000 in December, after a rise of 64,000 in November. The unemployment charge is forecast to have edged right down to 4.5 per cent, following an increase to 4.6 per cent in November, which was partially distorted by a chronic federal authorities shutdown.