Does February’s jobs report signal a slowdown?
New data released in early February showing an uptick in unemployment benefit applications has raised questions about whether the job market is beginning to cool. While a single report rarely tells the full story, jobless claims can provide an early signal of how businesses are responding to broader economic uncertainty. To help interpret the latest trends, David Quigley, economist at The University of Texas at Arlington, explains what unemployment claims actually measure—and what workers in North Texas should watch in the months ahead.
What does a rise in jobless claims actually mean?
Dr. Quigley: When someone is laid off, they can apply for unemployment insurance benefits through their state's program. If a person is fired for certain causes, such as harassment, they are generally ineligible to receive benefits. States report the number of applications weekly. These numbers reflect claims filed—not whether the person ultimately receives benefits. Some workers who lose their jobs never file a claim, and some jobs are not covered by unemployment insurance. So the data does not capture every layoff, but there is still a strong correlation between rising jobless claims and increasing layoffs.
What does the latest jobless claims data suggest about the broader economy?
Quigley: Current jobless claims are higher than typical during periods of strong economic growth. However, past recessions have produced much worse numbers, and one report alone cannot tell us whether this is a short-term fluctuation or the beginning of a more persistent wave of layoffs. It is not a positive sign for the labor market or job seekers, but the extent of the seriousness remains uncertain.
What are you seeing in the Dallas-Fort Worth region?
Quigley: For now, Texas numbers are not particularly severe, and the situation in DFW likely reflects that. However, the region is not immune to national trends. If economic conditions worsen nationally, DFW would almost certainly feel the impact.
Should workers be concerned about the recent increase in claims?
Quigley: A single weekly increase is typically not cause for major concern on its own. However, it adds to other signs of labor market weakness, such as slower hiring. Taken together, the data suggests at least some near-term softness in the job market, so some concern is warranted. Individual experiences may differ substantially from overall statistics, but the trends are not improving.
How can jobless claims rise while the unemployment rate remains low?
Quigley: The unemployment rate and jobless claims come from different data sources. The unemployment rate is measured through a monthly government survey, while jobless claims count every person who files for benefits and are reported weekly. Because of this timing difference, increases in claims may not appear in the unemployment rate for some time. The unemployment rate is also revised later as more data come in, so it may eventually move closer to what the claims data suggest.
Are some industries being affected more than others?
Quigley: The health care sector continues to show steady job growth. In contrast, manufacturing is declining, partly due to tariffs. Many other sectors are not currently adding jobs, and layoffs in those industries could occur in the future.
What does the drop in job openings to a multi-year low indicate about hiring?
Quigley: Fewer job openings often signals future job losses, as companies typically slow hiring before layoffs begin. This is especially affecting new graduates, whose rising unemployment rates can foreshadow broader labor market weakness. Economic uncertainty—including large swings in tariff policy and slower overall growth—is also contributing to companies’ reluctance to hire.
What other economic indicators should we watch in the months ahead?
Quigley: Future monthly jobs reports will provide more clarity about labor market conditions. Quarterly GDP [gross domestic product] numbers can help indicate overall economic growth. Continued monitoring of weekly jobless claims is also important because their frequency allows them to signal labor market weakening before it appears in other reports.
About The University of Texas at Arlington (UTA)
The University of Texas at Arlington is a growing public research university in the heart of Dallas-Fort Worth. With a student body of over 42,700, UTA is the second-largest institution in the University of Texas System, offering more than 180 undergraduate and graduate degree programs. Recognized as a Carnegie R-1 university, UTA stands among the nation’s top 5% of institutions for research activity. UTA and its 280,000 alumni generate an annual economic impact of $28.8 billion for the state. The University has received the Innovation and Economic Prosperity designation from the Association of Public and Land Grant Universities and has earned recognition for its focus on student access and success, considered key drivers to economic growth and social progress for North Texas and beyond.