1st-time Unemployment Insurance Claims Drop

By Mark Lieberman

Managing Director and Senior Economist

Highlights

  • There were 216,000 1st-time claims for unemployment insurance for the week ended June 15, DOWN 6,000from the previous week’s unrevised 216,000;
  • The four-week moving average of initial claims ROSE 1,000 to 218,750;
  • Four week moving average represented 0.145 percent of employment, UP from 0.144 percent the previous week;
  • The number of continued claims – individuals who had been collecting unemployment insurance — reported on a one-week lag, was 1,662,000 for the week ended June 8, DOWN 37,000 from the previous week’s UPWARDLY REVISED 1,699,000; (from 1,695,000)
  • The four-week moving average of continued claims ROSE 5,250 to 1,679,000.

Trends:

  • Initial claims for unemployment insurance declined for the first time in five weeks (May 11, down 16,000 to 212,000);
  • Four-week moving average of 1st-time claims rose for the second week in a row;
  • Continued claims fell after rising for two weeks in a row.

Data Source: Department of Labor

Image result for unemployment

Despite a dip in first time claims for unemployment insurance, the preliminary report from the Labor Department hints the 49-year low unemployment rate could be in jeopardy when the Bureau of Labor Statistics releases its June Employment Situation report on July 5.

Comparing new unemployment insurance claims from mid-month in May to mid-June (the “reference week” used by the BLS, claims rose slightly which suggests a boost in unemployment thus threatening the 3.6 percent unemployment rate.

(To be sure, the unemployment claims numbers are subject to revision and won’t be finalized until next week.)

Initial claims rose from mid-April to mid-May, with a corresponding increase in the unemployment rate (carried to two decimal places) from 3.58 percent to 3.62 percent, each of which rounded to the headlined 3.6 percent rate. 

The data for the other half of the claims report – continued claims which is a rough surrogate for hiring –is published on a one-week lag. Prior to the last BLS report, which showed a disappointing 75,000 new jobs in May, continued claims increased 8,000 from mid-month to mid-month, presaging the slower job creation.

You can hear Mark Lieberman every Friday at 6:20 am (EDT) am on the Morning Briefing on P.O.T.U.S. radio, Sirius-XM 124. You can follow him on Twitter at @foxeconomics.

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