Unemployment Claims Hit 2-Year Low—But Layoffs Are Still Surging?

Additional Resources

• Department of Labor Report
• Dec 04 Challenger Report
• Job Seekers Find In-Person Interviews Come with Hefty Costs
• “Classic” Employer Benefits Are A Strong Draw For US Job Seekers Across Ages

Transcript

Pete Newsome: 0:00

Today’s job market headlines include ongoing layoff announcements, job seekers footing the bill just to interview, and new data that shows classic benefits remain some of the strongest magnets for top job seekers. But first, jobless claims just hit a two-year low, but the story is more nuanced than that. This morning’s Department of Labor release shows that for the weekending November 29th, seasonally adjusted initial unemployment claims fell to 191,000, which is down 27,000 from the prior week. It’s the lowest reading since September 22, and the four-week moving average also declined. Now that sounds like good news, and it is technically, but it’s to me not the best indication of the health of the job market. It’s just one data point. Now, some states did see big increases, including California, Illinois, Pennsylvania, Washington, and New York, and those are driven by layoffs in construction, retail, warehousing, and professional services. We just saw an ADP’s uh payroll report yesterday that those were the areas that have declined overall.

1:07

So consistent data from what the private company released with what the government is telling us. So I like to see those aligned, even though I’m skeptical of all of it. And it’s is good news that we’re seeing historic lows in unemployment claims because that means that people who are losing jobs aren’t staying on unemployment. They’re finding new roles fairly quickly. But we do know that companies aren’t hiring at scale. That’s where the nuance comes in. So I see it right now, uh, the job market as a situation that varies greatly by industry, geography, experience level, and specific skill set. So it’s really a perfect example how the labor market right now just feels really contradictory. Along those lines, layoff announcements are piling up fast. According to Challenger Gray and Christmas, U.S. employers announced more than 71,000 job cuts in November. That’s 24% higher than a year earlier, and it’s the eighth time this year layoffs have exceeded the same month in 2024. For the year overall, employers have announced 1.17 million layoffs, which is a 54% jump over last year. That puts 2025 on track to be one of the heaviest layoff years since the early 90s. The top reasons cited are restructuring, store or unit closures, and of course, AI-related workforce changes.

2:29

More than 6,000 cuts were tied directly to AI in November. And I know some people will hear that and be skeptical that AI is really impacting the job market to such a degree. It is. Don’t let your personal feelings about the quality of AI or whether it should be happening get in the way of what’s actually happening because this is taking place and it’s only going to pick up speed. I believe that very strongly. All the evidence I see supports that. Now, not everyone does agree. Gardner just said again yesterday that they expect 50% of companies who are implementing AI to replace workers will pull back on those plans by 2027. I hope they’re right. I hope I’m wrong about this, but I don’t want anyone to be fooled by what’s happening. And I want to encourage everyone just to pay attention to it, how it’s affecting your industry, how it’s affecting your specific job and what you do professionally, how your company views it. All these things are going to matter for your career. So pay attention and follow the trends.

3:30

The report also showed that planned hiring totaled just over 497,000 through November, and that’s the lowest year-to-date number since 2010. So more of the same. Employers aren’t hiring the way we need them to. Competition has continued to increase for job seekers right now. I promise I will continue to look for good news and good trends out there, and I’ll report them as soon as I see them. The next headline tells us job seekers aren’t just investing time to interview, they’re spending cash just to show up. A new Indeed Harris poll survey found that 84% of candidates spent money to attend an in-person interview this year. Expenses include transportation, childcare or pet care, printing or portfolio costs, and interview prep courses or coaching. Now I’ll get back to that last one in a second.

4:19

But 30% who took the survey said they spent more than $100 on their most recent in-person interview, and 7% spent more than $200. The thing that I want to focus on is this uh idea of paying for interview prep. Don’t do it. You don’t need to do it. There’s absolutely no reason, especially when you’re looking for a job. It’s all for it’s all there for free. You just have to spend a little time and effort. And I do mean a very little bit of time and effort finding the right resources. If you don’t know where to find them, let me know. I’ll point you in the right direction. You can go to my company’s website, fourcornerresources.com. We have a wealth of information on there. Get on ChatGPT. It’s mostly reliable for interview prep. But don’t spend money on something that is all available for free that you can find on your own. Again, if you don’t know where to find any of that information, let me know, and I’ll be happy to point you in the right direction.

5:15

Finally, for today, when it comes to employee benefits, health insurance and PTO are still king across every generation. A new Indeed hiring lab report found that 49% of U.S. job seekers said better benefits is one of the top reasons they’re considering a new job. It’s second only to higher pay. That’ll always be at the top. The most valued benefits remain the classics health insurance, paid vacation, and paid sick days. But younger workers show strong interest in flexibility, parental leave, education benefits, commuter assistance, and workplace perks of which there’s no limit to the creative things that are out there. I see something new almost every week now in terms of what companies are offering. But despite all that, traditional benefits are still at the top of the list, even for young professionals. Now, part-time workers and self-employed folks who took this survey, they indicated they’re more likely than a full-time employee to say benefits are a primary motivator in their job search.

6:10

And that just makes sense when you look at how much benefits are really worth. According to BLS, employee-provided benefits make up about 24% of total compensation. And as an employer, I know that to be true. A lot of it’s hidden, a lot of it isn’t on the surface. We try our best to make sure our employees know what we’re offering, see the value in it. We offer a lot of paid time off, which is the biggest motivator, I would say, after healthcare. So my own experience, what I see with my internal team, is very consistent with what this survey shows. So no surprise to me in seeing this data. But here’s the bottom line when you look at how expensive healthcare has become, and it is crazy to me. I mean, our healthcare price went up about 50% this year, right? It’s just become astronomical.

6:59

You don’t want to pass that on to employees if you don’t have to. And so when it comes to recruiting and attracting talent right now, benefits aren’t something that should be considered an extra. It’s really a strategic thing to apply because the better your benefits are, the happier your employees are going to be in many cases. Those are your headlines for today. But before we go, here’s your fun fact. The highest minimum wage in the U.S. is in Washington, D.C. The lowest is in Wyoming and Georgia. They’re tied at the bottom. I think it’s in the $5 range there. What are you guys doing in Wyoming and Georgia? Step it up, would you? So thanks for listening today. Please like, subscribe, share with anyone you think might be interested. And I will look forward to talking to you tomorrow.