May 2020 Initial Unemployment Claims 3,169,000 This Week

Market expectations for weekly initial unemployment claims (from Econoday) were 2200K to 3420K (consensus 2,991K), and the Department of Labor reported 3,169,000 new claims. The more important (because of the volatility in the weekly reported claims and seasonality errors in adjusting the data) 4 week moving average moved from 5,035,000 (reported last week as 5,033,250) to 4,173,500.

Analyst Opinion of Initial Unemployment Claims

According to the BLS:

The COVID-19 virus continues to impact the number of initial claims and its impact is also reflected in the increasing levels of insured unemployment.

The pandemic has so far caused a 33,765,000 job loss.

It should be pointed out that Econintersect watches the year-over-year change in the 4-week moving average. There is always some seasonality that migrates into the seasonally adjusted data, and year-over-year comparisons help remove some seasonality. The four-week rolling average of initial claims is 1788% higher than one year ago (versus the 2235 % higher last week) - and is higher than any historical value for this data set.

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Claim levels before the coronavirus pandemic were at 40-year lows (with the normal range around 350,000 weekly initial unemployment claims of levels seen historically during times of economic expansion - see chart below).

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From the Department of Labor:

In the week ending May 2, the advance figure for seasonally adjusted initial claims was 3,169,000, a decrease of 677,000 from the previous week's revised level. The previous week's level was revised up by 7,000 from 3,839,000 to 3,846,000. The 4-week moving average was 4,173,500, a decrease of 861,500 from the previous week's revised average. The previous week's average was revised up by 1,750 from 5,033,250 to 5,035,000.

The advance seasonally adjusted insured unemployment rate was 15.5 percent for the week ending April 25, an increase of 3.1 percentage points from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending April 25 was 22,647,000, an increase of 4,636,000 from the previous week's revised level. The previous week's level was revised up 19,000 from 17,992,000 to 18,011,000. The 4-week moving average was 17,097,750, an increase of 3,800,250 from the previous week's revised average. The previous week's average was revised up by 5,000 from 13,292,500 to 13,297,500.