US Jobless Spells Hit 27 Weeks, a Decade High Outside Covid
Hiring numbers for October beat forecasts, yet people who lose a job are staying out of work longer. The average jobless spell reached 27.1 weeks, a ten-year high if the pandemic period is set aside.
Solid payrolls, stuck job seekers
Friday's release from the Bureau of Labor Statistics showed nonfarm payrolls up by 165,000, far above what economists had forecast. The unemployment rate edged down to 4.1%, a little under expectations.
A separate BLS report on Tuesday put September job openings well above forecasts, and the number of people quitting climbed to its highest since March 2025. Layoffs and discharges fell to their lowest volume in over a year.
The market has become what is called low-hire, low-fire. Employers hesitate to lay people off but add few workers, so those who lose a job struggle to get back in.
Benefits end before the search does
Most government unemployment benefits stop after 26 weeks in a year. The average spell now runs past that limit. Stahle, the Indeed economist quoted below, called that gap the key point.
The growing share of long-term unemployed may also be part of the reason jobless claims, new and ongoing, have stayed low: these workers have used up most or all of their benefits.
What long gaps cost
Studies tie long spells without work to drained savings, weaker earnings prospects over time and declining mental health. Researchers at the Federal Reserve Bank of Richmond warned earlier this year that the problem can feed itself: "Time spent unemployed may itself reduce the probability of finding a job." As possible reasons they listed fading skills, thinning networks and employers who read a long gap as a negative signal.
The numbers behind the headline
The long-term unemployed are people out of work for 27 weeks or longer. By the bureau's count there are about 2 million of them, and their 27.6% share of all jobless workers is the highest since late 2021.
On a seasonally adjusted basis, the average spell now comes to nearly seven months. The last time it ran this long outside the pandemic was 2016, when the labor market was only just recovering from the 2008 financial crisis.
Cory Stahle, senior economist at the hiring platform Indeed, cautioned that this series can be noisy from month to month. Over a longer period, he said, "there is no mistake in the trend."
Layoff headlines cloud the mood
CNBC reported this week that Disney is planning to cut thousands of jobs. American Express said last month it was reducing head count by 5% as it reorients around artificial intelligence. Elizabeth Renter, lead economist at Life360, said a feed full of layoffs and friends who have searched for months can make upbeat labor-market stories seem jarring.
Source: CNBC