| Consensus | Consensus Range | Actual | Previous | Revised | |
| Initial Claims - Level | 225K | 224K to 235K | 216K | 220K | 222K |
| Initial Claims - Change | -6K | -8K | -6K | ||
| 4-Week Moving Average | 223.75K | 224.250K | 224.75K |
Highlights
Initial jobless claims trended lower for the third week in a row in the November 22 week to reach their lowest level since mid-July. New claims for unemployment benefits continue at levels consistent with a healthy labor market where layoff activity is low. If hiring is weak, businesses are keeping the workers they have to avoid problems and costs in replacing them later. The recent government shutdown does not appear to have triggered a wave of layoff activity. Businesses typically adjust their payrolls in late November and December when making plans for the upcoming year. It seems likely that layoff activity will remain relatively modest in 2025.
New claims are down 6,000 in the week ending November 22 to 216,000 after 222,000 in the prior week. The level is just below the consensus of 225,000 in the Econoday survey of forecasters. The four-week moving average is down 1,000 to 223,750. The underlying trend for new claims appears stable in the 220,000-230,000 range.
Insured jobless claims are up 7,000 to 1.960 million in the November 15 week, a small move higher with little significance. The four-week moving average is up 750 to 1.956 million, pointing to steady levels for those receiving benefits. Levels remain below the 2 million-mark that might suggest deterioration in the labor market for workers eligible for benefits. The insured rate of unemployment is 1.3 percent in the November 15 week, and has been there for six months.
Market Consensus Before Announcement
Claims expected back up to 225K after dipping below 4-week moving average of 224K to 220K last week.
Definition
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.
Description
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.
