This Christmas week initial claims declined -1,000 to 219,000. The four week average rose 1,000 to 226,500. With the typical one week delay, continuing claims 46,000 to 1.910 million, the highest number in over 3 years:

On the YoY% basis more important for forecasting purposes, initial claims were up 2.8%, and the four week average was up 7.7%  Continuing claims were up 5.1%:

Because of seasonality issues at this time of year, the four week average is much more important. The numbers over the past few months tell us that while there is no recession in the immediate future, there is some definite weakness creeping into the economy, and in particular the jobs aspect.

Finally, since the trend in initial claims in particular leads the unemployment rate by a number of months, here is what the YoY% change in each looks like:

Over the past few months, the trend in claims has been between 5%-10% higher. Since one year ago the unemployment rate was 3.7%, this suggests the unemployment rate should trend towards 3.9%-4.1% in the next several months (note we are calculating % changes in a % number). Since in thee past few months the unemployment rate has been 4.1%-4.3%, this suggests a rate that is unchanged or slightly lower month over month. Recall also that very high immigration may have distorted the unemployment rate higher this year compared with its normal trend.

This further suggests that the Sahm rule, which was triggered for several months earlier this autumn, will remain back down below its threshold, currently at th 4.2% unemployment rate level averaged over 3 months.

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