Weekly Unemployment Claims: Down 5K

Here is the opening statement from the Department of Labor:

REVISION TO SEASONAL ADJUSTMENT FACTORS

Beginning with the Unemployment Insurance (UI) Weekly Claims News Release issued Thursday, April 7, 2022, the methodology used to seasonally adjust the national initial claims and continued claims reflects a change in the estimation of the models.

SEASONALLY ADJUSTED DATA

In the week ending April 2, the advance figure for seasonally adjusted initial claims was 166,000, a decrease of 5,000 from the previous week's revised level. The previous week's level was revised down by 31,000 from 202,000 to 171,000. The 4-week moving average was 170,000, a decrease of 8,000 from the previous week's revised average. The previous week's average was revised down by 30,500 from 208,500 to 178,000. The advance seasonally adjusted insured unemployment rate was 1.1 percent for the week ending March 26, unchanged from the previous week's revised rate. The previous week's rate was revised up by 0.2 from 0.9 to 1.1 percent.

The advance number for seasonally adjusted insured unemployment during the week ending March 26 was 1,523,000, an increase of 17,000 from the previous week's revised level. The previous week's level was revised up 199,000 from 1,307,000 to 1,506,000. The 4-week moving average was 1,541,250, a decrease of 35,250 from the previous week's revised average. The previous week's average was revised up by 187,500 from 1,389,000 to 1,576,500. [See full report]

This morning's seasonally adjusted 166K new claims, down 5K from the previous week's revised figure, was below the Investing.com forecast of 200K.

Here is a close look at the data over the decade (with a callout for the past year), which gives a clearer sense of the overall trend.

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.

Here's a copy of the above chart, but zoomed in, so the COVID spike isn't as prominent. We'll be adding a few more of these "zoomed in" looks in the coming weeks.

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).

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.

Here's a look at a sample of year's claims going back to 2009.

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