Weekly Initial Claims for Unemployment Continue to Trend Lower
Initial claims for regular state unemployment insurance fell to 267,000 for the week ending November 6, a drop of 4,000 from the previous week’s tally of 271,000 (see first chart). The latest data is the sixth drop in a row, and the 12th decline in the last 16 weeks; it is also the lowest level of the recovery and the fifth in a row below 300,000. The last time initial claims posted four consecutive weeks below 300,000 was February-March 2020.
The four-week average fell for a fifth consecutive week, coming in at 278,000, also the lowest level of the recovery. Initial claims for unemployment benefits are approaching their pre-pandemic level of 212,000, the average for January and February 2020.
The number of ongoing claims for state unemployment programs totaled 1.878 million for the week ending October 23, a drop of 102,420 from the prior week. The latest result is the sixth decline in a row and the 13th in the last 15 weeks. Before the pandemic, state continuing claims were just over 2 million (see second chart).
Continuing claims in all federal programs totaled 687,568 for the week ending October 23, a drop of 4,675. The Extended Benefits, Pandemic Unemployment Assistance, and Pandemic Emergency Unemployment Compensation programs are all trending lower as these programs wind down (see second chart).
The latest results for the combined Federal and state programs put the total number of people claiming benefits in all unemployment programs, including all emergency programs, at 2.566 million for the week ended October 23, a fall of 107,095 from the prior week (see second chart).
Initial claims continue to trend lower as new Covid cases slow. Overall, the labor market remains tight, as labor shortages, along with materials shortages and logistical issues, continue to hamper supply across the economy, driving up prices. Eventually, supply will rise to meet demand but in the interim, price pressures remain elevated.
Robert Hughes
Robert Hughes joined AIER in 2013 following more than 25 years in economic and financial markets research on Wall Street. Bob was formerly the head of Global Equity Strategy for Brown Brothers Harriman, where he developed equity investment strategy combining top-down macro analysis with bottom-up fundamentals. Prior to BBH, Bob was a Senior Equity Strategist for State Street Global Markets, Senior Economic Strategist with Prudential Equity Group and Senior Economist and Financial Markets Analyst for Citicorp Investment Services. Bob has a MA in economics from Fordham University and a BS in business from Lehigh University.
