US Weekly Jobless Claims Total 221k Vs 228k Expected

by Ike Obudulu Posted on May 31st, 2018

Washington, D.C., USA: Initial jobless claims declined 13,000 to 221,000 in the week ended May 26, but claims for several states, including California and Virginia, were estimated,  the U.S. Department of Labor said Thursday in it’s Unemployment Insurance Weekly Claims Report. First-time claims for state unemployment benefits were expected to total 228,000 in the most recent week, down from the 234,000 claims reported for the previous week.

In the week ending May 26, the advance figure for seasonally adjusted initial claims was 221,000, a decrease of 13,000 from the previous week’s unrevised level of 234,000. The 4-week moving average was 222,250, an increase of 2,500 from the previous week’s unrevised average of 219,750.

The Labor Department said claims for California, Kansas, Virginia, Maine, Hawaii, Puerto Rico and the Virgin Islands were estimated last week because of Monday’s Memorial Day holiday.

The labor market is viewed as being close to or at full employment. The jobless rate is near a 17-1/2-year low of 3.9 percent, within striking distance of the Federal Reserve’s forecast of 3.8 percent by the end of this year.

The four-week moving average of initial claims, viewed as a better measure of labor market trends as it irons out week-to-week volatility, rose 2,500 to 222,250 last week.

The claims report has no bearing on May’s employment report, which is scheduled for release on Friday.

Seasonally Adjusted Data

In the week ending May 26, the advance figure for seasonally adjusted initial claims was 221,000, a decrease of 13,000 from the previous week’s unrevised level of 234,000. The 4-week moving average was 222,250, an increase of 2,500 from the previous week’s unrevised average of 219,750.

Claims taking procedures in Puerto Rico and in the Virgin Islands have still not returned to normal.

The advance seasonally adjusted insured unemployment rate was 1.2 percent for the week ending May 19, unchanged from the previous week’s unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending May 19 was 1,726,000, a decrease of 16,000 from the previous week’s revised level. The previous week’s level was revised up 1,000 from 1,741,000 to 1,742,000. The 4-week moving average was 1,743,500, a decrease of 8,500 from the previous week’s revised average. This is the lowest level for this average since December 15, 1973 when it was 1,735,750. The previous week’s average was revised up by 250 from 1,751,750 to 1,752,000.

Unadjusted Data

The advance number of actual initial claims under state programs, unadjusted, totaled 201,374 in the week ending May26, a decrease of 5,669 (or -2.7 percent) from the previous week. The seasonal factors had expected an increase of 6,565 (or 3.2 percent) from the previous week. There were 232,138 initial claims in the comparable week in 2017.

The advance unadjusted insured unemployment rate was 1.1 percent during the week ending May 19, unchanged from the prior week. The advance unadjusted number for persons claiming UI benefits in state programs totaled 1,579,407, a decrease of 24,712 (or -1.5 percent) from the preceding week. The seasonal factors had expected a decrease of 10,450 (or -0.7 percent) from the previous week. A year earlier the rate was 1.3 percent and the volume was 1,759,705.

The total number of people claiming benefits in all programs for the week ending May 12 was 1,631,905, an increase of 9,115 from the previous week. There were 1,822,609 persons claiming benefits in all programs in the comparable week in 2017.

Extended benefits were payable in the Virgin Islands during the week ending May 12.

Initial claims for UI benefits filed by former Federal civilian employees totaled 654 in the week ending May 19, anbincrease of 54 from the prior week. There were 724 initial claims filed by newly discharged veterans, a decrease of 223 from the preceding week.

There were 7,757 former Federal civilian employees claiming UI benefits for the week ending May 12, an increase of 493 from the previous week. Newly discharged veterans claiming benefits totaled 7,711, an increase of 109 from the prior week.

The highest insured unemployment rates in the week ending May 12 were in the Virgin Islands (3.5), Alaska (2.8), California (2.0), New Jersey (2.0), Connecticut (1.9), Puerto Rico (1.9), Pennsylvania (1.7), Illinois (1.6), Rhode Island (1.5), Nevada (1.4), and Washington (1.4).

The largest increases in initial claims for the week ending May 19 were in Pennsylvania (+2,219), California (+2,162), Michigan (+1,695), Kentucky (+1,660), and New Jersey (+1,126), while the largest decreases were in Missouri (-2,648), Washington (-305), Minnesota (-269), Wisconsin (-161), and Florida (-137).

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;

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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