As of December 26, 2025, the U.S. labor market is showing a "low-hiring, low-firing" trend. The most recent data reflects a recovery from the federal government shutdown that occurred earlier this fall, though unemployment has reached its highest level in four years.
Latest Headline Numbers (November 2025 Report)
Because of the government shutdown, the Bureau of Labor Statistics (BLS) released a combined update for October and November recently:
Unemployment Rate: Rose to 4.6% (up from 4.4% in September). This is the highest rate since early 2017 (excluding the pandemic).
Nonfarm Payrolls: Added 64,000 jobs in November, beating economist expectations of 40,000. However, this follows a revised loss of 105,000 jobs in October.
Labor Force Participation: Remained steady at 62.5%.
Average Hourly Earnings: Edged up 0.1% for the month, bringing the 12-month increase to 3.5%.
Weekly Jobless Claims (Released Dec 24, 2025)
The most immediate data comes from the weekly Department of Labor report:
Initial Claims: Fell by 10,000 to 214,000 for the week ending December 20. This is the lowest level since January 2025, suggesting that while hiring is slow, mass layoffs remain infrequent.
Continuing Claims: Rose slightly to 1.92 million, indicating that those who are unemployed are finding it takes longer to secure new positions.
Context: The "Functional" Unemployment Gap
A notable report released today (Dec 26) by the Ludwig Institute suggests that "functional unemployment"—which includes those working part-time involuntarily or earning below-poverty wages—is much higher than the headline rate, sitting at approximately 24.8%. This highlights a growing gap between having a job and achieving financial stability in the current economy.
What's Next: The next major "Employment Situation" report (covering December 2024 data) is scheduled for release on January 9, 2026.
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