The steady and heartening progress we saw earlier in the year on initial unemployment claims appears to have hit a discouraging bump.
The number of people applying for new unemployment-insurance benefits rose 16,000 to 357,000 in the week ended March 23, reaching the highest level since mid-February, the U.S. Labor Department reported Thursday. Economists had expected initial jobless claims for regular state unemployment-insurance benefits to rise to 339,000 from an original estimate of 336,000 in the prior week, according to a MarketWatch survey. Rising claims signal more layoffs, and initial claims have increased for two consecutive weeks.
It's hard to tell just yet, but it's worth watching in the coming weeks whether (and how much) congressional Republicans' sequestration cuts are responsible for pushing these numbers higher.
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. We've been below the 370,000 threshold 14 of the last 16 weeks, and we've also been below 350,000 in five of the last seven 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.