| Consensus | Consensus Range | Actual | Previous | Revised | |
| Initial Claims - Level | 205K | 200K to 210K | 206K | 203K | 204K |
| Initial Claims - Change | 2K | -4K | -3K | ||
| 4-Week Moving Average | 207.250K | 205.5K | 205.750K |
Highlights
Claims remain mostly confined to a range of roughly 200K to 210K, coming in at 206K in the latest week. That is up 2K from the previous week's revised 204K (previously 203K).
The 4-week moving average is 207.250K, up 1,500 from 205.750K in the previous week. These numbers have been relatively flat in this range, which is down considerably from 230.500 a year ago.
The claims series indicates remarkable stability in the employment market. Fed officials talk a lot about a labor market roughly in balance with low unemployment just above 4 percent, the so-called low hire, low fire economy, and these claims reports bear that out. Fed Governor Chris Waller this morning says the job market is in"satisfactory" shape.
Market Consensus Before Announcement
Claims are seen pretty flat at 205K from 203K in the previous 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.
