There are still some seasonal quirks that are affecting the totals, but the newly released figures from the Department of Labor on initial unemployment claims continue to look quite encouraging.
The number of people applying for new unemployment benefits climbed above 300,000 again and could rise a bit more in the next few weeks as a pair of states work through a backlog of claims stemming from the Labor Day holiday and updates to their computer systems. Initial jobless claims climbed by 15,000 in the week ended Sept. 14 from a slightly revised 294,000 in the prior week, the Labor Department said Thursday. Economists surveyed by MarketWatch had expected claims to jump to 338,000 on a seasonally adjusted basis. A Labor official said California and Nevada made changes to their computer systems at the start of September that resulted in processing delays of some claims applications. Those applications could show up in the next few weeks and possibly push new claims higher. The current level of jobless claims is the lowest since the fall of 2007.
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, and when the number drops below 370,000, it suggests jobs are being created rather quickly. At this point, we’ve been below 340,000 in 9 of the last 10 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.