WASHINGTON, Sept 3 (Reuters) – The number of Americans filing claims for unemployment benefits increased marginally last week, suggesting no material shift in labor market conditions at the end of August.
Initial claims for state unemployment benefits climbed 2,000 to a seasonally adjusted 206,000 for the week ended August 29, the Labor Department said on Thursday. Economists polled by Reuters had forecast 205,000 claims for the latest week.
Claims are hovering in the lower end of their 189,000-230,000 range for this year, consistent with what economists say remains a “slow hire, slow fire” labor market.
Despite robust domestic demand, employers remain hesitant to boost head count as they navigate aggressive trade and immigration policies. A separate report from global outplacement firm Challenger, Gray & Christmas showed announced plans to hire by companies increased 37% in the first eight months of this year compared to the same period in 2025.
But the company noted that “it doesn’t appear those positions are being filled quickly.” Planned job cuts increased 58% to 52,881 in August. Announced layoffs so far this year are, however, down 41% compared to the same period last year. Low layoffs are anchoring the labor market and the broader economy.
The Federal Reserve’s Beige Book report on Wednesday described employment as having risen “very slightly” in August, noting that “healthy labor demand was seen most frequently in manufacturing, construction and some service sectors, while retail and hospitality sectors saw falling labor demand.”
The sluggish hiring has left some people who lose their jobs to endure long bouts of unemployment. The number of people receiving unemployment benefits after an initial week of aid, a proxy for hiring, increased 8,000 to a seasonally adjusted 1.779 million during the week ended August 22, the claims report showed.
The claims data have no bearing on August’s employment report as they fall outside the survey period.
The government is expected to report on Friday that nonfarm payrolls rebounded by 56,000 jobs last month after declining 23,000 in July, a Reuters survey of economists showed. The unemployment rate is forecast unchanged at 4.1%.
The anticipated recovery would partly reflect a rebound in local government education payrolls. But some economists believe a second straight month of job losses could not be ruled out after Temporary Protected Status for hundreds of thousands of Haitians recently ended, impacting their work authorization.
Payrolls also have a tendency to undershoot expectations in August. In the absence of labor market deterioration, economists expect the U.S. central bank to raise interest rates as early as this month to combat inflation stemming from import tariffs and the U.S.-led war with Iran.
Fed Chairman Kevin Warsh said last week the central bank will “have work to do” if policymakers do not get the confidence they need that inflation is falling to its 2% target.
(Reporting by Lucia Mutikani; Editing by Andrea Ricci)
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