1st Time Unemployment Insurance Claims Resume Decline

By Mark Lieberman

Managing Director and Senior Economist

Highlights

  • There were 214,000 1st time claims for unemployment insurance for the week ended July 7 a DECREASE of 18.000 from the prior week’s report;
  • The four-week moving average of first-time claims DROPPED 1,750 to 222,000;
  • The number of initial claims for the week ended June 29 was revised up 1,000 to 232,000;
  • Four-week moving average represented 0.143 percent of employment, DOWN from 0.144 the previous week;
  • The number of continued claims –individuals who have been collecting unemployment insurance — reported on a one-week lag, was 1,739,000 for the week ended June 30, DOWN 3,000 from the previous week’s UPWARDLY REVISED 1,742,000 (revised from 1,739,000);
  • The four-week moving average of continued claims ROSE 9,500 to 1,728,500.

Trends:

  • The drop in the number of initial claims completely wiped out the increase in filings in the prior two weeks (up 10,000 for the week ended June 23 and up 4,000 for the week ended June 30);
  • The four-week moving average of continued claims increased for the first time since the week ended April 7;

Data Source: Department of Labor

Image result for unemployment insurance claims

The data set of first time claims for unemployment insurance resumed its downward trajectory after a two-week hiccup due to a resumption of pre-Hurricane processes in the U.S. Virgin Islands (where claims rose from 10,000 to 22,000) and the furloughs of auto workers in Michigan (where claims rose by more than 9,000) as auto plants continued their annual retooling for new models.

Beyond those anomalies, the claims report continued to reflect good news about the tight labor market. Indeed, the weekly report echoed the signals from the Job Opening and Labor Turnover report earlier this week which (although for May) showed a sharp, 8.3 percent, in layoffs and discharges. As a percentage of all separations, layoffs and discharges fell to 29.0 percent, lowest since the JOLTS report began in 2000.

The drop in continued claims was also presaged by JOLTS data which showed the number of hires in May at 5.75 million, the highest monthly total ever recorded in the series.

The unemployment insurance claims data suggest little or no impact of the influx of previously unemployed workers to the total labor force (employed plus unemployed). The Bureau of Labor Statistics last week reported the number of re-entrants to the labor force at 2.086 million, the largest total since February 1987, an increase of 204,000 from May. The month-month change was the largest since December 2012.

You can hear Mark Lieberman every Friday at 6:20 am on the Morning Briefing on P.O.T.U.S. radio @sxmpotus, Sirius-XM 124.

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