1st Time Unemployment Claims Plunge

By Mark Lieberman

Managing Director and Senior Economist

Highlights

  • There were 206,000 1st time claims for unemployment insurance for the week ended December 8, a DECREASE of 27.000 from the prior week’s upwardly revised report (231,00 to 233,000).
  • The four-week moving average of first-time claims FELL 3,750 to 224,740;
  • Four-week moving average represented 0.143 percent of employment, DOWN from 0.146 the previous week.
  • The number of continued claims – individuals who had been collecting unemployment insurance — reported on a one-week lag, was 1,631,000 for the week ended December 1, DOWN 5,000 from the previous week’s upwardly REVISED 1,636,000 (from 1,631,000);
  • The four-week moving average of continued claims FELL 2,500 to 1,665,750.

Trends:

  • The drop in first-time claims was the largest since the week ended January 18 (down 46,000);
  • The four-week moving average of first-time claims dropped for the first time in five weeks;
  • The drop in the four-week moving average of 1,665,750 continued claims was the first in five weeks;

Data Source: Department of Labor 

Image result for unemployment

On the heels of Tuesday’s report showing an uptick in both job openings and hires, the weekly report on first-time unemployment insurance claims plunged for the week ended last Saturday.

The report likely reflects seasonal part-time hiring, a trend observed in last week’s Employment Situation report which showed both retail and temp jobs increase. The number of retail jobs increased in November by the largest amount since May and temp jobs were up for the fifth straight month.

The drop in claims in California (6,900 not seasonally adjusted) was a contributing factor. Initial claims in California shot up more than 29,000 one week earlier in the wake of devastating forest fires.

Still, the improvement in claims doesn’t automatically mean the jobs picture has emerged from the doldrums which saw the number of first-time claims jump from 210,000 at the beginning of October to 233,000 two weeks ago. The announcement of major labor layoffs at General Motors may have spooked other employers who see the end of the economic expansion which began in September 2010.

While “recession” has emerged from whispers to a regular part of the economic discussion, trouble signs are hardly hidden. GM’s announcement coupled with business plan changes at Ford put the auto industry in the economic crosshairs and the nation’s other major industry, housing. Continues to struggle, so much so that the Housing Market Index last month plummeted in November to the lowest level in more than two years. The December reading is due next week.

According to both Fortune and Forbes, the tariffs put into effect by the Trump Administration have resulted in cuts in manufacturing.

Falling stock prices could touch off a scramble to improve profits by reducing expenses translated as jobs

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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