According to the Zhichun Finance APP, the number of initial applications for unemployment benefits in the usa significantly dropped to its lowest level in seven months in the week before Thanksgiving, suggesting that businesses are not laying off employees as extensively as some economists had predicted. This demonstrates the resilience of the usa labor market and suggests that consumer spending, supported by the labor market, is likely to remain strong, with the usa economy continuing to show steady growth. However, continuing claims for unemployment benefits unexpectedly rose to a three-year high, indicating that many workers in the usa who have lost their jobs may be experiencing long-term unemployment, which opens up the possibility for the Federal Reserve to cut rates again in December, though it is not sufficient to sustain the same rate-cutting pace by the Federal Reserve in 2025.

Data released on Wednesday showed that for the week ending November 23, new applications for unemployment benefits decreased by 2,000 to 0.213 million, better than economists' general expectations of around 0.216 million; the revised figure for first-time claims in the previous week was 0.215 million, showing a slight increase compared to the prior revision. Due to the Thanksgiving holiday on Thursday, the report was released one day earlier.

There is no doubt that the number of initial applications for unemployment benefits has sharply declined from the nearly one-and-a-half-year high in early October, when the number was affected by hurricanes and strikes at boeing as well as another aerospace company.

However, it is more difficult for unemployed individuals to find jobs compared to the high-inflation period of previous years. The continuous increase in the number of continuing claims for unemployment benefits reinforces this view. In the week ending November 16, the number of individuals continuing to receive benefits after initially receiving unemployment assistance unexpectedly increased by over 9,000, with a seasonally adjusted figure of approximately 1.907 million, reaching the highest level since November 2021. Therefore, some economists expect that although employment numbers are projected to continue rebounding, the unemployment rate in November may remain unchanged or could even slightly increase.

However, the phenomenon of corporate layoffs has not appeared on a large scale, and the still relatively low unemployment rate has become the cornerstone of the steady expansion of the usa economy. The resilient labor market is said to provide the strongest momentum for the continued robust american consumer spending, which accounts for as much as 70%-80% of usa GDP.

Recent economic data over the past few months has revealed the same signal: despite the persistent core inflation pressures, consumers are still continuing to spend, bringing the usa economy closer to a "soft landing."

Recent labor market data and unemployment claims show that usa companies are not aggressively hiring, but due to the ongoing labor shortages, they are also unwilling to lay off employees. Companies are willing to retain workers, which helps to sustain growth in american consumer spending and the overall economy, avoiding a recession.

However, for the usa labor market and the usa economy, the biggest hidden danger may currently lie in: from the continued unemployment claims data, for those americans who need new jobs or have just lost their jobs, finding new employment takes longer, especially as some small and medium-sized companies are waiting for interest rates to continue declining and consumer spending to accelerate before adding a significant number of new employees.

The continually rising number of ongoing unemployment benefit claims indicates that many unemployed workers are facing increasing difficulty in finding new jobs.

The continued unemployment claims data covers the period during which the government surveyed the household unemployment rate in November. The usa non-farm unemployment rate has remained stable at 4.1% for two consecutive months, and the November non-farm employment report is crucial for the federal reserve’s interest rate decision in mid-December. Currently, the interest rates futures market is still betting that the federal reserve will cut rates by 25 basis points in December, with the probability rising to nearly 70% after the unemployment claims were announced. However, interest rate futures traders are betting that the federal reserve may adopt a "gradual slow rate cut pace" next year—occasionally pausing cuts to observe economic data.

The minutes from the federal reserve's monetary policy meeting held on November 6-7, which were released on Tuesday, indicate that federal reserve officials seem to have significant disagreements about the specific extent to which further rate cuts may be needed. deutsche bank chief economist Matthew Luzzetti expects that the fed will carry out its final rate cut of 25 basis points in December this year, after which the fed is likely to pause rate cuts throughout the next year.