Private estimates show jobless claims increased this week amid disruption. Economists at major banks say contractor layoffs and delayed data reporting are distorting the picture, though early signs point to a modest softening in labour conditions.
Initial unemployment claims in the United States likely rose to around 235,000 in the week ending 4 October, according to estimates from JPMorgan, Goldman Sachs, and Citigroup. The increase from 224,000 a week earlier would mark the second consecutive rise in jobless filings, based on state-level submissions still being compiled despite the ongoing federal shutdown.
The US Labor Department has paused official publication of weekly claims data since 1 October, when the federal government entered a funding lapse after Congress failed to pass appropriations for fiscal year 2026. The suspension has left markets and policymakers relying on private estimates and state-reported figures to gauge employment conditions.
JPMorgan economist Abiel Reinhart said the latest rise likely reflects temporary layoffs among government contractors affected by the shutdown, while cautioning that, excluding such disruptions, claims remain reasonably low. His view was echoed by analysts at Citigroup, who described the uptick as contained given broader labour market resilience.
Continued claims, representing those still receiving unemployment benefits, are estimated at 1.93 million for the week ending 27 September, up slightly from 1.92 million the week before, according to Reuters data.
Economists noted that while the figures suggest a mild weakening in hiring momentum, they are far from levels that would signal a marked deterioration in employment. However, the absence of government data — including the closely watched September non-farm payrolls report — has complicated assessments of the economy’s trajectory.
Analysts warn that the Federal Reserve is now effectively flying blind, unable to access timely indicators of wage growth and job creation. The lack of data could delay or cloud the central bank’s next policy decision, particularly as it weighs whether to extend rate cuts later this year.
The shutdown has furloughed an estimated 900,000 federal workers and left around 700,000 more working without pay. In previous shutdowns, including 2013 and 2018–19, similar disruptions produced short-term spikes in jobless claims and delayed recoveries in affected sectors once government operations resumed.
With negotiations over a spending resolution still stalled, economists expect volatility in the coming weeks as data gaps persist. For now, the modest rise in estimated claims provides a partial glimpse — but not the full picture — of an economy adjusting to political gridlock.
