• Initial jobless claims declined to 216,000 for the week ending October 26 from an upwardly revised 228,000 in the prior week. While claims have settled down after rising in the first two weeks of October, they remain elevated in Florida due to the devastation of Hurricane Milton. The insured unemployment rate was unchanged at 1.2% for the week ending October 19.

• The four-week moving average fell by 2,250 to 236,500 but is up sharply from 210,500 in the same week last year, suggesting the U.S. labor market has cooled over the past 12 months.

• Continuing claims for unemployment insurance dipped by 26,000 to 1.862 million for the week ending October 19, but are only marginally higher compared to a year earlier (1.816 million).

• PNC expects job gains to slow to around 150,000 for the balance of this year and about 100,000 in the first half of 2025, pushing the unemployment rate up to around 4.5%.  

First time jobless claims unexpectedly fell to 216,000 for the week ending October 26 from an upwardly revised 228,000 in the previous week, well below PNC’s forecast for an uptick to 245,000. Initial claims have settled down after rising the first two weeks in October, particularly in Florida and North Carolina, the two states most impacted by the hurricanes. Indeed, this is the lowest level of claims since mid-May. Initial claims are unchanged from a year ago. The four-week moving average slipped by 2,250 to 236,500 but is up sharply from 210,500 in the same week last year, suggesting the U.S. labor market has cooled over the past year. The insured unemployment rate was 1.2% for the week ending October 19, unchanged from the previous week and spot on with the rate a year earlier.

Continuing claims for unemployment insurance decreased by 26,000 to 1.862 million for the week ending October 19. Continuing claims are somewhat higher compared to a year earlier when they stood at 1.816 million. Furthermore, the four-week moving average increased by 10,750 to 1.869 million and is up from 1.809 million a year earlier, indicating it is taking unemployed workers longer to find a new job.   

The U.S. labor market continues to cool against a backdrop of still-restrictive monetary policy. Job gains have slowed to an average of 200,000 this year from 251,000 last year and the unemployment rate has climbed by 70 basis points from 3.4% in April 2023 to 4.1% in September 2024. PNC expects a further softening in the labor market as economic growth moderates, with average job gains of around 150,000 a month in the final quarter of this year and about 100,000 per month in the first half of 2025. As a result, the unemployment rate will rise to around 4.5% by mid-year 2025 and then drift slightly lower in 2026 as job growth accelerates amid lower interest rates. 

The PNC Financial Services Group, Inc. is one of the largest diversified financial services institutions in the United States, organized around its customers and communities for strong relationships and local delivery of retail and business banking including a full range of lending products; specialized services for corporations and government entities, including corporate banking, real estate finance and asset-based lending; wealth management and asset management. For information about PNC, visit www.pnc.com.