Though initial unemployment claims improved steadily throughout the year, the latest figures show 2013 is not ending on an encouraging note.
New applications for U.S. unemployment benefits rose last week to the highest level since late March, but the increase probably reflects typical holiday-season ups and downs instead of any discernible change in a labor market that’s shown clear improvement lately. Initial claims climbed by 10,000 to 379,000 in the week ended Dec. 14, the Labor Department said Thursday. Just three weeks ago, claims had fallen to as low as 305,000.
Some caveats are in order. For one thing, processing at the state level is often off this time of year, and because of the holidays, some volatility is expected. Still, the spike is out of step with expectations.
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, despite the recent spike, we’ve been below 370,000 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.