The United States labour market continues to show resilience despite ongoing softness in hiring activity, according to the latest data from the Department of Labor. Initial jobless claims fell by 6,000 to 216,000 in the week ending November 22, down from 222,000 in the previous week and below market expectations of 225,000. This figure also came in below the 2024 fiscal year average of 223,370, reaffirming the labour market’s strength.
On a non-seasonally adjusted basis, the largest declines in claims were recorded in Kentucky (-1,115), New Jersey (-568), and Maryland (-382), while the most significant increases came from California (+8,219), Illinois (+2,967), and New York (+2,476). The four-week moving average eased to 223,750, down 1,000 from the previous week’s reading of 224,750, reflecting a broadly stable trend in jobless claims.
Economists suggest that layoffs are likely to remain contained, keeping initial jobless claims at structurally low levels. However, they caution that tighter trade and immigration policies, along with rising efficiency gains from increased AI integration, could soften hiring sentiment in specific sectors, presenting modest downside risks to near-term employment growth.
Meanwhile, retail sales data from the US Census Bureau indicates a cooling in consumer spending. Retail sales grew 4.3% year-on-year in September, down from 5.0% in August, while month-on-month growth was just 0.2%, undershooting expectations of 0.4%. The slowdown reflects ongoing pressure on households from tariff-driven price increases, which continue to erode purchasing power and limit discretionary spending.
Notable declines were observed in goods, hobby, musical instrument, and bookstore sales (-2.5% y/y) and clothing retailers (-0.7% y/y), areas particularly sensitive to consumer confidence. Some categories, however, such as miscellaneous store retailers (+2.9% y/y) and gasoline stations (+2.0% y/y), recorded modest gains, largely due to higher fuel prices.
Analysts expect consumer demand to remain subdued in the near term, citing the combined impact of elevated prices, softer hiring conditions, and tariff-induced costs that continue to compress disposable incomes.
