The number of Americans filing new applications for unemployment benefits increased moderately last week, signaling continued stability in the U.S. labor market despite global economic concerns linked to the ongoing U.S.-Israel-Iran conflict. According to the U.S. Labor Department, initial claims for state unemployment benefits rose by 10,000 to a seasonally adjusted 200,000 for the week ended May 2, remaining below economists’ expectations of 205,000. Analysts said the figures suggest layoffs remain historically low and do not yet indicate major stress in the economy.
Economists noted that steady employment conditions are strengthening expectations that the U.S. Federal Reserve will keep interest rates unchanged this year. Christopher Rupkey, chief economist at FWDBONDS, said there is currently “no reason to consider interest rate cuts” because the labor market remains “steady as a rock.” Meanwhile, separate government data showed job openings improved in March, with nearly one vacancy available for every unemployed person, reinforcing signs of a resilient labor market despite rising geopolitical tensions and concerns over oil supply disruptions through the Strait of Hormuz.
The report also revealed that continuing claims, which reflect the number of people receiving unemployment benefits after their first week, fell by 10,000 to 1.766 million — the lowest level since January 2024. While technology firms continue to announce layoffs linked to artificial intelligence adoption, overall job cuts this year are significantly lower compared to 2025. Economists are now awaiting the April nonfarm payrolls report, which is expected to show job growth slowing to 62,000 after a stronger rebound in March, while the unemployment rate is projected to remain steady at 4.3%.
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