- by New Deal democrat
One of the main reasons I include the last two years when I write about initial and continued jobless claims is that a distinct unresolved post-pandemic seasonality has developed. Even after seasonal adjustment, claims have tended to rise in the late spring towards the summer, and then decline beginning in late summer towards the winter.
That was manifested in this week’s numbers. Initial claims rose 14,000 to 240,000, one of the highest readings in the past six months. The four week moving average declined -250 to 231,750, also at the high end of the pat six months’ readings. Continued claims, with the usual one week delay, rose 26,000 to 1.919 million, after a -10,000 revision to last week’s number:
As usual, the YoY% change is more important for forecasting purposes. And as has been the case almost universally for the past six-eight months, the comparisons are higher by single digits. Initial claims were higher by 8.6% YoY, the four week average higher by 3.9%, and continuing cliams higher by 6.7%:
This continues the pattern of forecasting continued growth in the immediate future, albeit weak.
Finally, with the jobs report coming out next week, let’s update the forecast for the unemployment rate. Below I show the YoY% comparisons of intiai claims, total jobless claims, and the unemployment rate (red). In gray I also show the absolute unemployment rate (right scale):
The YoY% changes in initial and total jobless claims have been amazingly consistent in the past eight months, centered on a 5% increase, plus/minus 5%. One year ago the unemployment rate was 4.0%. This suggests the unemployment rate is most likely to hold steady at 4.2% (i.e., 4.0 * 1.05) +/-0.1% in the next few months.
