U.S. Weekly Jobless Claims Drop to 52-Year Low: 5 Top Picks

U.S. weekly unemployment benefit claims declined steadily over the last six months barring some minor fluctuations. The latest data released by the Department of Labor on Nov 24 showed that initial claims plunged to a 52-year low. The labor market, which was the best-performing segment of the U.S. economy before the outbreak of coronavirus, suffered the most during the pandemic. Of late, the U.S. labor market is stabilizing around the pre-pandemic level.

At this stage, it will be fruitful to invest in staffing stocks with a favorable Zacks Rank. Here we have selected five such companies. These are — Korn Ferry KFY, Kforce Inc. KFRC, Cross Country Healthcare Inc. CCRN, Robert Half International Inc. RHI and Resources Connection, Inc. RGP.

Signs of Systematic Recovery

The Department of Labor reported that the weekly jobless claims plunged by 71,000 to 199,000 for the week ended Nov 20, marking the lowest level since Nov 15, 1969. The consensus estimate was 260,000 and the data for the previous week was revised upward to 270,00 from 268,000 reported earlier. Notably, initial claims were hovering around 200,000 in the pre-pandemic period.

Continuing claims (those who already received government benefit) declined 60,000 to 2.05 million for the week ended Nov 13. This is the lowest reading since Mar 14, 2020. The total number of people receiving benefits under all programs fell 752,390 to 2.43 million, as of Nov 6. Notably, receivers of unemployment benefits topped more than 30 million at the pandemic high.

Robust Job Additions in October

The U.S. economy added 571,000 jobs in October, exceeding the consensus estimate of 442,000. Moreover, September’s job additions were revised upward to 312,000 from a disappointing 194,000 reported earlier. August’s data was also revised upward to 483,000 from 366,000 reported earlier.

Total private payrolls rose 604,000 in October, partially offset by 73,000 declines in government jobs. The unemployment rate came down to 4.6% in October from 4.8% in September. The consensus estimate was 4.7%.

Momentum Likely to Continue

The U.S. economy is witnessing an impressive recovery since the beginning of 2021, faster-than-expected by a large number of market participants. The vaccination drive on a priority basis and an unprecedented stimulus helped the economy ramp up the activities level.

On Nov 15, President Joe Biden signed a bipartisan infrastructure bill of $550 billion in addition to the previously approved funds of $450 billion for five years. Total spending may go up to $1.2 trillion if the plan is extended to eight years.

The infrastructure development project will be a major catalyst for the U.S. stock markets in 2022. Various segments of the economy such as basic materials, industrials, utilities and telecommunications will benefit immensely with more job creation for the economy.

Moreover, the White House has put pressure on Congress to quickly pass legislation providing $52 billion to help computer chip manufacturers and ease a shortage of the components vital to many industries.

Our Top Picks

We have narrowed our search to five staffing stocks that have popped in the past three months. These stocks have strong growth potential for the rest of 2021 and have seen positive earnings estimate revisions within the last 60 days. Each of our picks carries either a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The chart below shows the price performance of our five picks in the past three months.

Zacks Investment ResearchImage Source: Zacks Investment Research

Kforce Inc. is a full-service, web-based specialty staffing firm providing flexible and permanent staffing solutions in the United States. KFRC operates through the Technology and Finance and Accounting segments. offers web-based services including online resumes and job postings, interactive interviews and job placements and career management strategies.

Zacks Rank #1 Kforce has an expected earnings growth rate of 35.5% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 10.3% over the last 30 days. The stock price of KFRC has jumped 40.3% in the past three months.

Korn Ferry  is the world's leading and largest executive recruitment firm with the broadest global presence in this industry. KFY operates through four segments: Consulting, Digital, Executive Search, and Recruitment Process Outsourcing & Professional Search.

Zacks Rank #2 Korn Ferry has an expected earnings growth rate of more than 100% for the current year (ending April 2022). The Zacks Consensus Estimate for current-year earnings has improved 0.6% over the last 7 days. The stock price of KFY has advanced 17% in the past three months.

Cross Country Healthcare Inc. provides talent management and other consultative services for healthcare clients in the United States. CCRN operates in three segments: Nurse and Allied Staffing, Physician Staffing, and Search.

Zacks Rank #1 Cross Country Healthcare has an expected earnings growth rate of more than 100% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 10% over the last 7 days. The stock price of CCRN has climbed 40.2% in the past three months.

Robert Half International Inc. provides staffing and risk consulting services in North America, South America, Europe, Asia, and Australia. RHI operates through three segments: Temporary and Consultant Staffing, Permanent Placement Staffing, and Risk Consulting and Internal Audit Services.

Zacks Rank #1 Robert Half International has an expected earnings growth rate of 95.9% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 5.4% over the last 60 days. The stock price of RHI surged 14.3% in the past three months.

Resources Connection Inc. is a multinational professional services firm that helps business leaders execute internal initiatives. RGP provides experienced accounting and finance, human resources management and information technology professionals to clients on a project-by-project basis.

Zacks Rank #1 Resources Connection has an expected earnings growth rate of -0.8% for the current year (ending May 2022). The Zacks Consensus Estimate for current-year earnings has improved 19.4% over the last 60 days. The stock price of RGP has appreciated 20.1% in the past three months.

Infrastructure Stock Boom to Sweep America

A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.

The only question is “Will you get into the right stocks early when their growth potential is greatest?”

Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.

Download FREE: How to Profit from Trillions on Spending for Infrastructure >>

Click to get this free report

KornFerry International (KFY): Free Stock Analysis Report

Robert Half International Inc. (RHI): Free Stock Analysis Report

Resources Connection, Inc. (RGP): Free Stock Analysis Report

Kforce, Inc. (KFRC): Free Stock Analysis Report

Cross Country Healthcare, Inc. (CCRN): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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