Weekly Unemployment Claims: Down 23K

Here is the opening statement from the Department of Labor:

In the week ending September 16, the advance figure for seasonally adjusted initial claims was 259,000, a decrease of 23,000 from the previous week's revised level. The previous week's level was revised down by 2,000 from 284,000 to 282,000. The 4-week moving average was 268,750, an increase of 6,000 from the previous week's revised average. This is the highest level for this average since June 4, 2016 when it was 269,500. The previous week's average was revised down by 500 from 263,250 to 262,750.

Hurricanes Harvey and Irma impacted this week's claims. [See full report]

Today's seasonally adjusted 259K new claims, down 23K from last week's revised 282K, was better than the Investing.com forecast of 300K.

Here is a close look at the data over the past few years (with a call-out for the past year), which gives a clearer sense of the overall trend in relation to the last recession.

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As we can see, there's a good bit of volatility in this indicator, which is why the 4-week moving average (the highlighted number) is a more useful number than the weekly data. Here is the complete data series.

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The headline Unemployment Insurance data is seasonally adjusted. What does the non-seasonally adjusted data look like? See the chart below, which clearly shows the extreme volatility of the non-adjusted data (the red dots). The 4-week MA gives an indication of the recurring pattern of seasonal change (note, for example, those regular January spikes).

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Because of the extreme volatility of the non-adjusted weekly data, we can add a 52-week moving average to give a better sense of the secular trends. The chart below also has a linear regression through the data. We can see that this metric continues to fall below the long-term trend stretching back to 1968.

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Annual Comparisons

Here is a calendar-year overlay since 2009 using the 4-week moving average. The purpose is to compare the annual slopes since the peak in the spring of 2009, near the end of the Great Recession.

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For an analysis of unemployment claims as a percent of the labor force, see regularly updated piece The Civilian Labor Force, Unemployment Claims and the Business Cycle Here is a snapshot from that analysis.

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