U.S. applications for unemployment benefits decreased last week, indicating layoffs remain relatively low despite a softening labor market and increased energy costs linked to the ongoing conflict in Iran.

Jobless Claims Decline

The Labor Department reported on Thursday that the number of Americans filing for jobless aid for the week ending March 28 fell by 9,000 to 202,000, down from the previous week’s 211,000. This figure is lower than the 212,000 new filings predicted by analysts surveyed by FactSet and remains within the typical range of the past several years.

Recent Layoff Announcements

Despite the overall trend, several prominent companies have recently announced job cuts. These include Oracle, which reportedly cut thousands of positions this week, as well as Morgan Stanley, Block, UPS, and Amazon.

Labor Market Trends

Weekly jobless aid applications have generally stabilized between 200,000 and 250,000 since the U.S. economy recovered from the pandemic recession. However, hiring has slowed over the past two years, further decelerating in 2025 due to factors such as President Trump’s tariff policies, federal workforce reductions, and sustained high interest rates aimed at controlling inflation.

Last year, employers added fewer than 200,000 jobs, a significant decrease compared to the approximately 1.5 million jobs added in 2024, according to FactSet data.

February Employment Report

The Labor Department’s February report revealed an unexpected decrease of 92,000 jobs, signaling continued strain on the labor market. Revisions also reduced the reported job gains for December and January by a combined 69,000, pushing the unemployment rate up to 4.4%.

Economic Uncertainty & Inflation

The weak February employment data adds to the economic uncertainty surrounding the war with Iran, which has caused oil prices to surge by over 40%, increasing costs for businesses and consumers. This occurs at a time when inflation was already elevated in the U.S.

The Commerce Department reported that the Federal Reserve’s preferred inflation gauge rose 2.8% in January compared to the previous year, exceeding the Fed’s 2% target. This persistent inflation, coupled with the uncertainties of the Middle East conflict, led the Fed to maintain its benchmark lending rate at its last meeting, casting doubt on the possibility of a near-term rate cut.

The central bank raised rates three times in late 2025 due to concerns about a weakening job market.

“Low-Hire, Low-Fire” Market

Economists describe the current labor market as being in a “low-hire, low-fire” state, resulting in a historically low unemployment rate but making it challenging for those seeking new employment. The four-week moving average of jobless claims declined by 3,000 to 207,750, while the total number of Americans filing for unemployment benefits reached 1.84 million for the week ending March 21.