No one was expecting a strong number for jobless claims this week as forecasts were predicting claims to come in at a record high. The median forecast was calling for claims to total 1.7 million compared to 282K last week which had been the highest reading since September of 2017. Instead, they practically doubled those forecasts coming in at a record 3.283 million. Fortunately, that was less than some of the most aggressive estimates like Citigroup which forecasted claims to be 4 million. This week’s data is an unprecedented albeit anticipated jump in jobless claims. To put the size of the number into perspective, that is roughly 1% of not the US working population, but the entire US population! In the history of the data going back to 1967, there has never been a higher number in the level of claims (first chart below) or week-over-week change (second chart below). The previous high for jobless claims was 695K from October of 1982, almost one-fifth of this week’s print. As for the week to week changes, the over 3 million increase in claims blew the size of the previous largest movements out of the water.
The four week moving average typically helps to smooth out the week to week fluctuations of the high-frequency data, but considering the size of the move, the utility of the moving average is fleeting this week. The moving average has also reached a record high and experienced the largest one week increase on record.
While it may not be much consolation given how horrific this week’s numbers are, one silver lining is in the non-seasonally adjusted number. Before seasonal adjustment, jobless claims were slightly less staggering at 2.898 million. In other words, seasonal factoring does make the number of claims look higher than the actual amount reported. But that is still the largest weekly increase and highest number on record regardless of any seasonal patterns that may be affecting the number. Given more workers are continuing to stay home than return to work these numbers are likely to keep rising over the coming weeks. Start a two-week free trial to Bespoke Institutional to access our interactive economic indicators monitor and much more.