November saw highest unemployment since 2021, largely attributed to federal worker reductions under Trump.

Over the past week, the number of United States residents applying for unemployment benefits has dropped to its lowest point in a month, according to new Labor Department statistics.

The weekly data released on Wednesday came at the end of a year marked by a weak labour market, a phenomenon analysts partly blame on hiring hesitancy caused by US President Donald Trump’s tariff policy.

Experts also warn that last week’s data may also be distorted by year-end holidays like Christmas: With the shorter work week, there was less opportunity to file unemployment claims.

Wednesday’s numbers mark the final full week of unemployment data for 2025. Jobless claims for the week ending on December 27 fell by 16,000 to 199,000. That was an improvement from the previous week, when the Labor Department recorded 215,000 jobless claims.

Its report also showed that the four-week average of jobless claims, which evens out some of the week-to-week volatility, rose by 1,750 to 218,750.

The US unemployment rate reached a peak of 4.6 percent in November, the highest percentage since 2021, when the country was grappling with the ravages of the COVID-19 pandemic.

The increase has largely been attributed to many federal employees leaving the workforce in the wake of Trump’s widespread cuts to government staffing.

Jobless claims are viewed as a proxy for layoffs and offer a real-time indicator of the health of the country’s job market.

Weak labour market

Recent US government data has revealed a labour market in which hiring has lost momentum, even as other economic indicators, including the gross domestic product (GDP), have remained strong.

Since March, job creation has fallen to an average of 35,000 a month, compared with 71,000 during the 12 months prior.

Earlier this month, Federal Reserve Chairman Jerome Powell said the US central bank reduced its benchmark lending rate by a quarter-point, out of concern that the job market is weaker than it appears.

The move was the Fed’s third straight rate cut, with Powell saying recent job figures could be revised lower by as much as 60,000.

Recent data showed the US lost 105,000 jobs in October, largely due to departing federal workers, but the US economy gained back 64,000 jobs in November.

Companies that have recently announced job cuts include the shipping giant UPS, automaker General Motors, online retailer Amazon and the telecommunications firm Verizon.