1st-time Unemployment Insurance Claims Flat but Labor Market Dims

By Mark Lieberman

Managing Director and Senior Economist

Highlights

  • There were 218,000 1st-time claims for unemployment insurance for the week ended June 1, UNCHANGED from the previous week’s upwardly revised (from 215,000);
  • The four-week moving average of initial claims FELL 2,500 to 215,000;
  • Four week moving average represented 0.142 percent of employment, DOWN 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 1,682,000 for the week ended May 25, UP 20,000 from the previous week’s UPWARDLY REVISED 1,662,000; (from 1,657,000)
  • The four-week moving average of continued claims FELL 1,000 to 1,672,750.

Trends:

  • Initial claims for unemployment insurance have not declined for three straight weeks (unchanged for two of them);
  • Four-week moving average of 1st-time claims has fallen for three straight weeks;
  • Four-week moving average of continued claims fell for the second straight week and ninth of the last 11 weeks.

Data Source: Department of Labor

First-time claims for unemployment insurance appear to have stabilized after reaching some (relatively) lofty levels in the last two weeks of April, but only employment indicators have moved in the opposite direction.

On the eve of the Bureau of Labor Statistics’ monthly Employment Situation report for May, data from payroll processor ADP and recruiting firm Challenger Grey and Christmas hint at some weakness in the otherwise strong labor picture.

ADP, which issues its own jobs forecast a few days before the BLS (but covering only private sector jobs) said the nation created 27,000 private sector jobs in May, the smallest gain since the beginning of the current expansion 10 years ago. Indeed, according to BLS data, the average monthly job gain since the Great Recession ended has been 170,000.

Challenger reported employers across the country announced plans in May to cut 56,600 jobs, up from 40,000 in April. A caveat: those figures represent announcements only of job cuts which may not occur if circumstances change. The figures include the elimination of already vacant positions.

Still the labor market snapshot is dimming with interpolation of claims data suggesting an increase in the 40-year low 3.6 percent unemployment rate and slower job growth in May.

You can hear Mark Lieberman tomorrow at 8:40 am (EDT) am on the Morning Briefing on P.O.T.U.S. radio, Sirius-XM 124 discussing the monthly Employment Situation release. You can also hear him on other Fridays at 6:20 am on the Morning Briefing on P.O.T.U.S.

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