US Weekly Jobless Claims Rise to 234K vs 221K Expected

by Ike Obudulu Posted on November 29th, 2018

Washington, D.C., USA  : In the week ending November 24, the advance figure for seasonally adjusted initial claims was 234,000 (vs 221,000 expected), an increase of 10,000 from the previous week’s unrevised level of 224,000. The 4-week moving average was 223,250, an increase of 4,750 from the previous week’s unrevised average of 218,500.

Seasonally Adjusted Data

The advance seasonally adjusted insured unemployment rate was 1.2 percent for the week ending November 17, unchanged from the previous week’s unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending November 17 was 1,710,000, an increase of 50,000 from the previous week’s revised level. The previous week’s level was revised down by 8,000 from 1,668,000 to 1,660,000. The 4-week moving average was 1,667,750, an increase of 19,750 from the previous week’s revised average. The previous week’s average was revised down by 1,750 from 1,649,750 to 1,648,000.

Unadjusted Data

The advance number of actual initial claims under state programs, unadjusted, totaled 217,834 in the week ending November 24, a decrease of 8,651 (or -3.8 percent) from the previous week. The seasonal factors had expected a decrease of 17,508 (or -7.7 percent) from the previous week. There were 224,851 initial claims in the comparable week in 2017.

The advance unadjusted insured unemployment rate was 1.0 percent during the week ending November 17, unchanged from the prior week. The advance unadjusted number for persons claiming UI benefits in state programs totaled 1,441,153, a decrease of 4,575 (or -0.3 percent) from the preceding week. The seasonal factors had expected a decrease of 46,476 (or -3.2 percent) from the previous week. A year earlier the rate was 1.2 percent and the volume was 1,618,630.

The total number of people claiming benefits in all programs for the week ending November 10 was 1,471,437, an increase of 9,037 from the previous week. There were 1,761,201 persons claiming benefits in all programs in the comparable week in 2017.

No state was triggered “on” the Extended Benefits program during the week ending November 10.
Initial claims for UI benefits filed by former Federal civilian employees totaled 1,366 in the week ending November 17, an increase of 153 from the prior week. There were 540 initial claims filed by newly discharged veterans, a decrease of 82 from the preceding week.

There were 8,623 former Federal civilian employees claiming UI benefits for the week ending November 10, an increase of 388 from the previous week. Newly discharged veterans claiming benefits totaled 6,895, an increase of 192 from the prior week.

The highest insured unemployment rates in the week ending November 10 were in Alaska (2.6), New Jersey (2.0), Puerto Rico (1.8), California (1.6), Connecticut (1.6), Pennsylvania (1.5), Virgin Islands (1.5), Montana (1.4), and Washington (1.4).

The largest increases in initial claims for the week ending November 17 were in Illinois (+2,026), Minnesota (+1,354), Wisconsin (+726), Missouri (+626), and Texas (+536), while the largest decreases were in California (-6,861), New Jersey (-2,347), New York (-1,680), Florida (-886), and Pennsylvania (-875).

Why Markets Care About Unemployment Insurance Weekly Claims

Unemployment Insurance Weekly Claims – also called  Jobless Claims or Initial Claims – measures the number of individuals who filed for unemployment insurance for the first time during the past week.

Unemployment Insurance Weekly Claims is the nation’s earliest economic data. The market impact fluctuates from week to week – there tends to be more focus on the release when traders need to diagnose recent developments, or when the reading is at extremes.

The usual effect is that if ‘Actual’ is less than ‘Forecast’, it is good for the dollar and vice versa.

Markets care because although it’s generally viewed as a lagging indicator, the number of unemployed people is an important signal of overall economic health since consumer spending is highly correlated with labor-market conditions. Unemployment is also a major consideration for those steering the country’s monetary policy.

Initial Claims

An initial claim is a claim filed by an unemployed individual after a separation from an employer. The claimant requests a determination of basic eligibility for the UI program. When an initial claim is filed with a state, certain programmatic activities take place and these result in activity counts including the count of initial claims. The count of U.S. initial claims for unemployment insurance is a leading economic indicator because it is an indication of emerging labor market conditions in the country. However, these are weekly administrative data which are difficult to seasonally adjust, making the series subject to some volatility.

Continued Weeks Claimed

A person who has already filed an initial claim and who has experienced a week of unemployment then files a continued claim to claim benefits for that week of unemployment. Continued claims are also referred to as insured unemployment. The count of U.S. continued weeks claimed is also a good indicator of labor market conditions.

Continued claims reflect the current number of insured unemployed workers filing for UI benefits in the nation. While continued claims are not a leading indicator (they roughly coincide with economic cycles at their peaks and lag at cycle troughs), they provide confirming evidence of the direction of the U.S. economy

Seasonal Adjustments and Annual Revisions

Over the course of a year, the weekly changes in the levels of initial claims and continued claims undergo regularly occurring fluctuations. These fluctuations may result from seasonal changes in weather, major holidays, the opening and closing of schools, or other similar events. Because these seasonal events follow a more or less regular pattern each year, their influence on the level of a series can be tempered by adjusting for regular seasonal variation. These adjustments make trend and cycle developments easier to spot. At the beginning of each calendar year, the Bureau of Labor Statistics provides the Employment and Training Administration (ETA) with a set of seasonal factors to apply to the unadjusted data during that year. Concurrent with the implementation and release of the new seasonal factors, ETA incorporates revisions to the UI claims historical series caused by updates to the unadjusted data.

Author

Ike Obudulu

Ike Obudulu

Versatile Certified Fraud Examiner, Chartered Accountant, Certified Internal Auditor with an MBA in Finance And Investments who has both worked for and consulted with some of the world's largest companies on main street and wall street in over 20 countries, Ike brings his extensive reporting and investigations experience to bear on his role as Chief Editor.
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