American employers are still refusing to fire anyone — and still refusing to hire much of anyone either.
Initial claims for unemployment benefits fell to 206,000 for the week ending August 15, the Labor Department reported Thursday, below the 210,000 economists had forecast and down from an upwardly revised 212,000 the prior week. The four-week moving average, which smooths out weekly volatility, rose to 204,000 from 199,750.
Continuing claims — the count of Americans already drawing benefits — edged up to 1.799 million for the week ending August 8, slightly above the 1.790 million consensus and up from a revised 1.781 million. The national unemployment rate stands at 4.1%.
Layoffs Stay Scarce Despite the Energy Squeeze
The resilience is notable given what has hit the economy since the conflict with Iran began. Crude prices spiked to roughly $100 a barrel in July before retreating, and President Trump's vow this week to wage "economic warfare" on Tehran pushed West Texas Intermediate back up 2.3% Thursday to around $86 a barrel.
"The labor market has yet to show any sign of wear and tear from the surge in oil prices since the start of the war with Iran," economist Carl Weinberg said.
Claims have held in a 200,000 to 230,000 band for the past year — historically low territory, and nowhere near the levels that typically precede a downturn.
The Other Half of the Equation
What the claims data does not capture is how hard it has become to find a job. Hiring has slowed dramatically: employers have added an average of 61,000 jobs a month in 2026, and July's payroll report actually showed a decline of 23,000. That follows 2025's average of just 9,700 jobs a month, the weakest pace outside a recession since 2002.
For comparison, monthly job creation averaged 166,000 across 2023 and 2024, and 491,000 during the 2021–2022 reopening boom. More than 1.3 million people have dropped out of the labor force entirely over the past year — a quiet exit that flatters the headline unemployment rate.
Markets Slip as Yields Rebound
Stocks retreated Thursday. The S&P 500 traded down 0.38% at 7,678.58, the Dow Jones Industrial Average fell 0.72% to 53,077.82, and the Nasdaq Composite dropped 0.73% to 26,139.63. The VIX climbed nearly 5% to 15.59.
Treasury yields reversed higher after Treasury Secretary Scott Bessent's surprise expansion of bond buybacks, with the 10-year rising five basis points to 4.70% and the 30-year to 5.25%. Gold was little changed at $4,540.30 an ounce. Walmart shares sank nearly 8% after U.S. same-store sales growth of 2.6% missed the 3.7% analysts expected, despite raised full-year guidance.
All Eyes on Jackson Hole
The data lands a week before Fed Chair Kevin Warsh delivers his first Jackson Hole keynote on August 28, roughly three weeks ahead of the September 15–16 FOMC meeting. Futures markets have swung wildly on the September call — pricing in as much as an 82% chance of a rate hike in late July before settling near a 50-50 split in mid-August.
A labor market that refuses to crack removes one argument against tightening. Whether energy-driven inflation supplies the argument for it is what Warsh will be asked to answer in Wyoming.
Sources: Associated Press (via KSAT), Yahoo Finance, CNBC, InvestingLive, Chase Investment Insights