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First, usually the week following the employment report is very quiet, and I put up “scenes from the report” with some important graphs. With all the releases catching up on old data this week, I haven’t done that; but because jobless claims are the only significant data this morning, I intend to put up a very important update on those “scenes” later this morning.

With that out of the way, let’s take our usual look at new and continuing jobless claims. I’ve noted a couple of times lately that there has been a “regime shift” from the end of last June towards lower YoY numbers. And that very much continued in this morning’s data.

Initial claims declined -9,000 last week to 198,000. Aside from a few weeks in the past 3+ years, there have been no numbers under 200,000 since the end of the 1960s! The four week average also declined -6,500 to 205,000. Similarly, aside from the last 3 years, 2018 and 2019, this is the lowest number in over 50 years. Finally, with the typical one week delay, continuing claims declined -19,000 to 1.884 million. Link here.

.There is a significant caveat, in that as shown in the graph linked to above, this is *very* similar to the post-pandemic unresolved seasonality we have seen in the past few years, notably exactly two years ago. 

All that being said, as usual it is the YoY comparisons that are more important for forecasting purposes. In that regard, initial claims were down -8.5% and the four week average down -3.5%. Only continuing claims remained higher, at 1.8%. Link here.

The analysis remains that *very* few people are getting laid off (possibly some of this is due to immigrants in some industries either quitting or getting deported), but those who are laid off are having a more difficult time finding new jobs. I’ll have more to say about that later this morning.

Finally, although I won’t bother with a link to a graph this week, the lower numbers portend a decline in the unemployment rate in the next several months. One year ago the unemployment rate was averaging 4.1%-4.2%, vs. the 4.4% in the December report, so I am expecting at least a small further decline ahead.

The bottom line is that jobless claims continue to forecast a growing economy in the months ahead.

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