The S&P 500 (SPX) is trading slightly lower on Thursday amid a concerning labor market update.
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U.S. employers announced 71,321 layoffs in November, up by 24% year-over-year and marking the highest level for the month since 2022, according to outplacement firm Challenger, Gray & Christmas. During October, planned layoffs totaled 153,074, the highest for the month since 2003.
At the same time, initial jobless claims for the week ended November 29 fell by 27,000 to 216,000 and were below the consensus estimate of 220,000. These claims track the number of people filing for unemployment benefits for the first time and generally rise in correlation with layoffs.
Holiday Volatility Skews Claims Data as ADP Reports Surprise Job Loss
Layoffs are usually volatile during the end of the year and around holidays, like Thanksgiving. “It’s normal for initial claims to be quite volatile during the holiday season, so I don’t attach much meaning to this week’s dip (and caution warranted about swings in the other direction, too),” said Burning Glass Institute director of economic research Guy Berger in an X post.
On Wednesday, ADP reported that the U.S. private sector lost 32,000 jobs in November, while economists were expecting 10,000 additions. Small businesses were responsible for all of the job losses, while mid-sized and large firms added jobs.
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