Other Labor Market Indicators Point to Cooling

Several additional indicators point to a labor market that is losing momentum.

Revelio Labs reported 16,700 job losses in February in its non-farm payroll release. The firm gained attention last fall when its data helped fill the gap during the government shutdown.

Unemployment claims remain relatively low, with 213,000 new claims filed. However, this figure may not fully capture layoffs in today’s economy. Many displaced workers are turning to gig or freelance work instead of filing for unemployment benefits, often because those benefits don’t fully cover essential costs like housing, utilities, and insurance. Continuing unemployment claims rose by 46,000 to 1.868 million. This measure tracks people who remain on unemployment benefits and suggests that job seekers are taking longer to find new positions.

Layoff and hiring announcements tell a similar story. Challenger, Gray & Christmas reported nearly 50,000 job cuts in February, following just over 108,000 in January. Combined layoffs in January and February rank among the highest for those two months since 2009. Meanwhile, hiring plans remain subdued. Companies announced just 18,061 planned hires through the first two months of the year, a 56% drop compared with the same period last year.

What’s the bottom line?
Higher continuing unemployment claims, elevated layoff announcements, and weak hiring plans all reinforce the view that the labor market is gradually cooling.