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 smoothes out weekly volatility. Why Investors Care
| Released on 1/17/08 For wk 1/12 2008 | ||||||||||||
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Highlights
In rare good news on the economy, initial jobless claims came way down in the Jan. 12 week, falling 21,000 to 301,000 for the lowest level since September. Market News International reports there were no special factors in the week. But the improvement was not confirmed by continuing claims which shot up 66,000 to 2.751 million in data covering the Jan. 5 week. Continuing claims, again in contrast to initial claims, are at their highest since November 2005.
More on initial claims. The Jan. 12 week is also the sample week for the BLS's household employment survey and a comparison with the relevant December week shows a very large 47,000 improvement, results that would point to a tick down in the unemployment rate which remember jacked up 3 tenths in December to 5.0 percent. A comparison of four-week averages also shows improvement, at 328,500 in the latest period vs. 343,500 in the December period for a 15,000 improvement.
One week of data will not turn around the economic outlook, but a repeat of this improvement, together with improvement in continuing claims, will definitely improve the outlook for the January employment report. Treasury yields and the dollar rose in reaction to the report which appears to have overshadowed another big fall in housing starts which were also released at 8:30 a.m. ET.
Initial jobless claims fell 15,000 in the week ending January 5 to 322,000 after dropping 20,000 the prior week. Continuing claims, reported for the December 29 week, also showed improvement, falling 51,000 to 2.702 million. Currently, the weak jobs report for December is still setting the mood for how the markets are viewing labor market data. While most indicators are pointing to a slowing economy overall, the latest two claims reports suggest that the December jobs report may have overstated weakness a little. Still, it is difficult to seasonal adjust data during the holidays and traders will be slow to believe any positive news on the labor front. But investors will certainly be watching the timely claims numbers for hints on the direction of the consumer and the economy.
Jobless Claims Consensus Forecast for 1/12/08: 335,000
Range: 330,000 to 340,000
![[Chart]](chart.gif)
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Weekly series fluctuate more dramatically than monthly series even when the series are adjusted for seasonal variation. The 4-week moving average gives a better perspective on the underlying trend. |
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