Bloomberg reports that
Initial jobless applications rose by 11,000 to 531,000 in the week ended Oct. 17, from a revised 520,000 the prior week ....
Today’s numbers represent claims for the week the Labor Department surveys companies to calculate this month’s payroll figures. The report is due Nov. 6.
The four-week moving average of initial claims, a less volatile measure, fell to 532,250 last week from 533,000.
Job growth/loss is the most important issue we are blogging about now imo. Here are my three takeaways from this report.
1. In the September 12 week which was used to calculate the September payroll data, there were 550,000 layoffs and the 4 week average was 565,000. If we assume for purposes of simplicity that hiring stayed the same in the last month, this number suggests something like 80,000-100,000 less layoffs, a good omen for the October jobs report.
2. For the second week in a row, the 4 week average is almost 20% less than the 659,000 peak. Another month or so of this number may mean (crossing all fingers and toes) actual job growth.
3. Calculated Risk thinks that seasonal hiring won't take place this year. But it's possible that seasonal firing also won't take place this year. And this is one of the two parts of the year where firings typically increase.
So, not a great initial claims report, but not a bad one (relatively speaking of course) either.
Click for a larger image
It's incredibly important to remember the following point: improvement takes time, especially considering where we're coming from. In the 4th quarter of last year to the first quarter of this year the US economy lost over 2.4 million jobs before the adjustment from the BLS is factored in. With the factoring we're looking at ~3 million. We're not going to see a major improvement in that figure for some time. Instead, we're going to see exactly what the chart is showing: a continuing trend of improvement. From the peak in late March/early April we've seen initial claims drop by approximately 100,000. In addition, the overall trend is clearly down.