Those hoping to see the month of May end on a positive note with regards to initial unemployment claims got their wish.
The number of people who applied for U.S. unemployment benefits fell by 8,000 to 276,000 in the seven days from May 24 to May 30, the government said Thursday. Economists polled by MarketWatch had expected initial claims to total a seasonally adjusted 278,000. The average of new claims over the past month edged up 2,750 to 274,750, the Labor Department said. The four-week average smooths out sharp fluctuations in the more volatile weekly report and is seen as a more accurate predictor of labor-market trends. Yet both jobless claims numbers are near 15-year lows, reflecting the small number of layoffs taking place in the economy each week.
To reiterate the point I make every Thursday morning, it’s worth remembering that week-to-week results can vary widely, and it’s best not to read too much significance into any one report.
In terms of metrics, when jobless claims fall below the 400,000 threshold, it’s considered evidence of an improving jobs landscape. At this point, we’ve been below 300,000 in 32 of the last 38 weeks.
Above you’ll find the chart showing weekly, initial unemployment claims going back to the beginning of 2007. (Remember, unlike the monthly jobs chart, a lower number is good news.) For context, I’ve added an arrow to show the point at which President Obama’s Recovery Act began spending money.
Also note, tomorrow is Jobs Day – the day the monthly totals for May are released by the Bureau of Labor Statistics.