At 205,000 in the December 16 week, initial jobless remain consistent with strong demand for labor. The 4-week average is down 1,500 to 212,000 for the lowest level since late October.

Continuing claims are less favorable than initial claims but are also positive. Down 1,000 in the December 9 week, the 1.865 million level is down from a recent high of 1.925 million in the November 18 week. The unemployment rate for insured workers is unchanged at 1.3 percent, also low but down from 1.2 and 1.1 percent through most of 2023.

Initial claims are the most important reading in this report and the result may have forecasters firming their estimates for the December employment report.

Jobless claims for the December 16 week are expected to come in at 210,000 versus 202,000 in the prior week.

New unemployment claims are compiled weekly to show the number of individuals who filed for unemployment insurance for the first time. An increasing (decreasing) trend suggests a deteriorating (improving) labor market. The four-week moving average of new claims smooths out weekly volatility.

Jobless claims are an easy way to gauge the strength of the job market. The fewer people filing for unemployment benefits, the more have jobs, and that tells investors a great deal about the economy. Nearly every job comes with an income that gives a household spending power. Spending greases the wheels of the economy and keeps it growing, so a stronger job market generates a healthier economy.

There's a downside to it, though. Unemployment claims, and therefore the number of job seekers, can fall to such a low level that businesses have a tough time finding new workers. They might have to pay overtime wages to current staff, use higher wages to lure people from other jobs, and in general spend more on labor costs because of a shortage of workers. This leads to wage inflation, which is bad news for the stock and bond markets. Federal Reserve officials are always on the look-out for inflationary pressures.

By tracking the number of jobless claims, investors can gain a sense of how tight, or how loose, the job market is. If wage inflation looks threatening, it's a good bet that interest rates will rise, bond and stock prices will fall, and the only investors in a good mood will be the ones who tracked jobless claims and adjusted their portfolios to anticipate these events.

Just remember, the lower the number of unemployment claims, the stronger the job market, and vice versa.