Latest jobless claims numbers are near 50-year low

The ranks of U.S. workers filing for jobless aid remains near a half-century low amid a tight labor market that’s spurring employers to keep hold of their workers. 

About 198,000 people filed for first-time unemployment benefits in the week ended December 25, the Labor Department said Thursday. That compares with about 205,000 jobless claims in the previous week. 

The Labor Department’s four-week moving average for newly unemployed people was 199,250, matching a low last seen in October 1969, the agency reported.  

The unemployment rate has fallen to 4.2%, close to what economists consider full employment.

Even though jobless claims have remained near a half-century low, there are concerns the Omicron variant now sweeping across the nation could cause a bump in layoffs. A spike in COVID-19 cases has sparked some businesses to scale back operations, from airlines to restaurants, in recent days. However, the numbers suggest the fast-spreading Omicron variant has yet to trigger a wave of layoffs.

“The claims data may be more volatile in the upcoming weeks due to the seasonal adjustment process but, looking past that noise, we expect claims to remain around 200,000 as layoffs remain low amid tight labor market conditions,” Nancy Vanden Houten, lead economist at Oxford Economics, said in a research note.

Altogether, 1.7 million Americans were collecting traditional unemployment aid the week that ended December 18, the lowest since March 2020 and down by 140,000 from the week before.

The weekly claims numbers, a proxy for layoffs, have fallen steadily most of the year. Employers are reluctant to let workers go at a time when it’s so tough to find replacements. The United States had a near-record 11 million job openings in October, and 4.2 million Americans quit their jobs — just off September’s record 4.4 million — because there are so many opportunities.

The Associated Press contributed to this report.