Initial jobless claims continued their return to normalcy this week, as they increased 3,000 to 221,000. The four week moving average declined -9,750 to 227,250, which is tied for the lowest number except for two weeks in five months. Continuing claims, with the typical one week delay, rose 39,000 to 1.892 million:

(Click on image to enlarge)

As per usual, the YoY% comparisons are more important for forecasting purposes. And here, the hurricane effects have almost all disappeared. Initial claims are higher by only 2.3%, the four week moving average higher by 7.3%, and continuing claims up by 3.8%:

(Click on image to enlarge)

Adding a line (light blue) for the biweekly YoY% in claims helps show this even better. Here it is over the past year:

(Click on image to enlarge)

On a biweekly basis, claims are actually *down* -0.5%. For the last three weeks, they are higher by 3.4%. 

Next week the big hurricane effects will drop out of the four week average, and all indications are that we will be completely back to normal.

And the takeaway is that the numbers are slightly higher YoY. This is not a “positive” result, but it is completely neutral and not recessionary at all (remember: to trigger even a yellow flag I would need monthly claims to be higher by 10% YoY. For a red flag it would take two consecutive months higher by 12.5% or more).

More By This Author: