Jobless Claims Make Steady Progress, But Nothing More
What is clear is that initial claims for unemployment benefits — which serve as a proxy for layoffs — paint a picture of a strengthening and resilient labor market. If initial claims for unemployment benefits defined the whole labor market story than the narrative of the jobs recovery would be easy to summarize; progress is steady, or at least, the labor market situation is not worsening. The Department of Labor reported Thursday that initial applications for jobless claims declined by 10,000 to a seasonally adjusted 311,000 in the week ended March 22.
This pace of new jobless claims surpassed analysts expectations for 325,000 new applications and, more importantly, last week’s drop not only put claims at levels last seen more than four months ago, before cold weather put the breaks on the labor market. Jobless claims are now in line with pre-recession levels; before the recession began in December 2007, an average number of 320,000 initial claims were filed each week due to the normal churn in the job market. Plus, economists say any claims figure below 350,000 indicate moderate job creation.
Confirming the thesis of labor market resilience is the fact that the underlying trends in jobless claims remained positive as well in the past week. Jobless claims provide the first look at the employment situation for any given month, but since the weekly figures can be volatile, economists use the four-week moving average to understand wider trends in employment, which are far more telling of labor market health than weekly readings. Falling by 9,500 from the previous week’s upwardly revised 327,250, the four-week moving average for the week ended March 22 dipped to 317,750.