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Jobless claim applications are seen as representative of the number of layoffs in a given week.

The Federal Reserve has been tapping the brakes on the economy and the labor market for nearly two years, trying to stem what was the highest inflation in four decades. The central bank raised its benchmark rate 11 times since March of 2022 as part of that effort.

Yet for months it seemed as though the aggressive actions from the Fed had little impact and companies have been forced to pay more to land employees.

Cracks, however, may be starting to show.

Overall, 1.87 million people were collecting unemployment benefits the week that ended Nov. 4, about 32,000 more than the previous week and the most in almost two years. It was the sixth straight week that continuing claims rose.

“Job growth remains strong, and businesses have yet to start reducing their workforce in a significant way,� said Rubeela Farooqi, chief U.S. economist for High Frequency Economics. “But the continuing claims data are pointing to some softening in labor demand, in line with what the Fed wants to see.�

Economists suggest that continuing claims are steadily rising because many of those who are already unemployed may now be having a harder time finding work, an indication that the labor market is looser than it's been in the post-pandemic era.

U.S. employers , adding a modest but decent 150,000 jobs. It's only the third time in almost three years that monthly job gains have come in under 200,000. Yet all three of those instances have come in the past five months.

“The claims data are consistent with a job market that is cooling enough to keep rate hikes off the table, but too strong to make rate cuts a consideration any time soon,� said economist Nancy Vanden Houten of Oxford Economics. “The Fed is surely encouraged by recent inflation data but needs to see a further slowdown in the labor market and wage growth to be persuaded that inflation is on a sustainable path back to 2%.�

Fed officials opted to leave the benchmark rate alone at their most recent policy meeting. Another increase before the end of the year has not been ruled out, yet recent data showed that inflation is continuing to ebb, a priority for Fed Chair Jerome Powell.

Overall inflation , the first time that consumer prices collectively haven’t budged from one month to another in more than a year. Compared with a year earlier, prices rose 3.2% in October, the smallest such rise since June, though still above the Fed’s 2% inflation target.

The four-week moving average of jobless claim applications, which flattens out some of weekly volatility, rose by 7,750 to 220,250.