Continuing Claims Come in Worse

Oct 12, 2023

While CPI was the main focus of the morning’s economic data, jobless claims were the other major release of the morning. Last week’s reading on seasonally adjusted initial claims was revised up by 2K to 209K and this week’s reading was unchanged from that level.   That was slightly below forecasts which were calling for claims to rise further to 210K.  Overall, claims have seen a rebound in the past few weeks, but that is still well below the range of readings from earlier this year.

Being the fourth quarter, seasonal tailwinds will shift to headwinds over the next few months. Prior to seasonal adjustments, initial claims saw a sizeable 22.8K week-over-week jump.  Claims rising in the current week of the year is very normal as it has occurred 85.7% of the time historically.  Given that increase, that would confirm last week as the likely annual low in unadjusted claims (at least for the time being). As we noted last week, that is a bit later than normal, but not exactly without precedence.

Relative to initial claims, continuing jobless claims have maintained a more consistent trend over the past several months. This year has seen continuing claims consistently grind lower, but that trend is not as strong as it once was as claims have appeared to round out a bottom.  Continuing claims topped 1.7 million this week. That is the highest reading since the week of August 19th and was well ahead of expectations of 1.675 million.  While claims are by no means weak (outside of the few years prior to the pandemic, current readings remain around some of the lowest since the early 1970s), both initial and continuing claims have seen modest deterioration recently.