December 19, 2015 Initial Unemployment Claims Rolling Average Marginally Worsens

Weekly Initial Unemployment Claims

The market (from Bloomberg) was expecting the weekly initial unemployment claims at 267 K to 275 K (consensus 270,000) vs the 267,000 reported. The more important (because of the volatility in the weekly reported claims and seasonality errors in adjusting the data) 4 week moving average moved from 270,750 (reported last week as 270,500) to 272,500. The rolling averages generally have been equal to or under 300,000 since August 2014.

It should be pointed out that Econintersect watches the year-over-year change on the 4 week moving average. There is always some seasonality which migrates into the seasonally adjusted data, and year-over-year comparisons helps remove some seasonality. The four week rolling average of initial claims are 5.6 % lower (marginal degradation from the 8.0 % for last week) than they were in this same week in 2014.

Weekly Initial Unemployment Claims – 4 Week Average – Seasonally Adjusted – 2011 (red line), 2012 (green line), 2013 (blue line), 2014 (orange line). 2015 (violet line)

Claim levels are at 40 year lows (with the normal range around 350,000 weekly initial unemployment claims of levels seen historically during times of economic expansion – see chart below).

From the Department of Labor:

In the week ending December 19, the advance figure for seasonally adjusted initial claims was 267,000, a decrease of 5,000 from the previous week’s revised level. The previous week’s level was revised up by 1,000 from 271,000 to 272,000. The 4-week moving average was 272,500, an increase of 1,750 from the previous week’s revised average. The previous week’s average was revised up by 250 from 270,500 to 270,750. There were no special factors impacting this week’s initial claims.

The advance seasonally adjusted insured unemployment rate was 1.6 percent for the week ending December 12, a decrease of 0.1 percentage point from the previous week’s unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending December 12 was 2,195,000, a decrease of 47,000 from the previous week’s revised level. The previous week’s level was revised up 4,000 from 2,238,000 to 2,242,000. The 4-week moving average was 2,211,000, an increase of 10,000 from the previous week’s revised average. The previous week’s average was revised up by 1,250 from 2,199,750 to 2,201,000.