Several years ago now, when jobless claims first dropped below 300K, that was a level that was considered impressive and most likely temporary. That’s because throughout the history of the series, whenever claims traded below that level, they didn’t stay there for long. With claims coming in below 300K consistently for three years now, the new ‘temporary’ level became 250K. Over the last five months, though, jobless claims have pretty consistently come in below that level now as well, and they are now settling in at what appears to be an even lower new level. In this week’s report, weekly claims dropped to a level of 222K, marking the third straight week where claims have come in below 230K. The last time that happened? 1973! There’s only so much lower claims can go right?
While the four-week moving average didn’t make a new low for the expansion this week, it came pretty darn close. At 226K, the four-week average is just 1K above the multi-decade low of 225K from early February, and if claims come in anywhere near this week’s level next week, we should see a new low.
On a non-seasonally adjusted basis, jobless claims also remain strong. At this week’s level of 213.3K, the NSA reading is 125K below the average for the current week of the year dating back to 2000, and in the history of the time series (going back to the late 1960s), there has never been a lower print for the current week of the year. No matter how you slice it, jobless claims continue to be one of the most impressive economic indicators tracking the US economy.