Initial Claims Still Weakly Positive, Most Consistent With Slowdown

I have started to monitor initial jobless claims to see if there are any signs of stress.

My two thresholds are:

1. If the four week average on claims is more than 10% above its expansion low.
2. If the YoY% change in the monthly average turns higher.

Here’s this week’s update.

Initial jobless claims last week were 216,000. This is average for the past 18 months. As of this week, the four-week average is 8.6% above its recent low: 

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and at 218,750, is only 250, or -0.1%, lower than this week last year: 

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This remains positive.

Last July, initial claims averaged 215,250 (red). Through the first two weeks, it is 212,000 this year (blue), which is also positive:

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So this too remains positive.

Finally, let’s compare the YoY% change in initial claims (blue) with continuing claims (red):

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Comparisons have been getting closer to crossing the threshold from lower to higher,  but this week moved lower to -3.8% YoY.  A longer-term view shows that - so far - this is most consistent with the 1984, 1994, and 1996 slowdowns, and not a recession:

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