The number of individuals filing for unemployment benefits plummeted last week, a further indication that layoffs remain uncommon and that the vast majority of Americans continue to enjoy job security.

The Labor Department reported Thursday that jobless claims slid to 196,000, the fewest since mid-July and down from 206,000 the week before.

The four-week average of claims, which smooths out week-to-week volatility, dropped to 203,250.

According to a survey conducted by the data firm FactSet, economists had anticipated that claims would come in at 207,500.

Claims for unemployment benefits serve as a proxy for layoffs, and economists monitor them closely because they can signal the trajectory of the job market.

Over the past year, claims have largely remained within a historically low range of 200,000 to 230,000 per week.

The American job market has remained sturdy despite higher gasoline prices that have squeezed businesses and consumers since the fighting with Iran began Feb. 28.

Layoffs remain subdued.

Businesses, mindful of the labour shortages that ensued once pandemic lockdowns were lifted, are disinclined to shed staff.

They are recruiting — albeit modestly by the standards of recent years.

Thus far this year, employers — encompassing companies, government agencies and nonprofits — have been augmenting their payrolls by an average of 80,000 jobs per month, including a surprising 162,000 in August.

This constitutes an improvement over a dismal 2025, when monthly job creation averaged a mere 9,700, as elevated interest rates and President Donald Trump's constantly shifting trade policies deterred hiring.

Yet it remains substantially beneath the 166,000 monthly jobs generated, on average, across 2023 and 2024, as well as the 491,000 per month recorded during the 2021-2022 hiring surge that ensued in the wake of COVID-19 lockdowns.