Jobless claims in the U.S. hit a 14-month high last week, as filings spiked to 258,000, the largest number since August 2023.
Analysts point to Hurricane Helene and the Boeing machinist strike as major contributors, rather than a sign of broader weakness in the labor market.
The Labor Department reported a significant rise of 33,000 claims in the week ending Oct. 3.
States most affected by Helene—Florida, North Carolina, South Carolina, and Tennessee—saw sharp increases in unemployment filings.
Nancy Vanden Houten, lead U.S. economist at Oxford Economics, noted that claims will likely stay high in areas impacted by Helene, as well as in Washington state due to the ongoing Boeing strike.
She added that the Fed is expected to view these impacts as temporary and still plans to lower rates by 25 basis points at the November meeting.
Jobless claims, a key measure of layoffs, tend to fluctuate week to week.
The four-week average, which smooths out some of this volatility, also ticked up, reaching 231,000.
The number of Americans currently receiving unemployment benefits rose by 42,000, bringing the total to about 1.86 million—the highest since late July.
Despite these spikes, other labor market data paints a mixed picture.
The Federal Reserve, having raised interest rates aggressively in 2022 and 2023, has now shifted focus toward supporting the job market.
Last month, it cut rates by a quarter of a percentage point, aiming for a “soft landing”—cooling inflation without triggering a recession.
Inflation is nearing the Fed’s 2% target, and Chair Jerome Powell has expressed optimism that it’s largely under control.
The government also reported Thursday that inflation is at its lowest level since February 2021.
While some job data suggests cooling, September surprised many economists with a robust addition of 254,000 jobs.
This marks a sharp uptick from August’s 159,000, easing fears of a deeper slowdown.
The unemployment rate also dipped for the second straight month, falling to 4.1% in September.
In this complex landscape of strikes, storms, and economic shifts, business leaders continue to assess the effects of interest rates on hiring, as the U.S. job market shows both resilience and fragility.
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