After a month-long respite, initial unemployment claims are again moving in the wrong direction. Today’s report from the Department of Labor was a discouraging one.
Last week’s figures were revised up slightly, and the new totals unfortunately reached a five-week high, in spite of expectations to the contrary.
The number of Americans who filed requests for jobless benefits climbed by 10,000 last week to 383,000, the highest level in five weeks, the U.S. Labor Department said Thursday. Claims from two weeks ago were revised up to 373,000 from 370,000. Economists surveyed by MarketWatch had projected claims would fall to a seasonally adjusted 370,000 in the week ended May 26. The average of new claims over the past four weeks, meanwhile, rose by 3,750 to 374,500.
It’s worth emphasizing that week-to-week results can vary widely, and it’s best not to read too much significance into any one report. That said, today’s figures, a day in advance of the new monthly job totals, are certainly disappointing.
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. We’ve only managed to dip below the 370,000 threshold once in the last eight weeks.
And with that, here’s 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.