Jobless claims fall to lowest level since September 2022
Jan 18, 2024, 10:05 AM
(Eric Thayer/Bloomberg/Getty Images)
There were an estimated 187,000 initial claims for unemployment insurance during the week that ended January 13, according to Department of Labor data released Thursday. That’s down by 16,000 claims from the week before and marked the lowest level of first-time claims — considered a proxy for layoffs — since September 24, 2022.
The week’s total for initial claims — considered a proxy for layoffs — landed far below economists’ projections for 205,000 initial claims, according to FactSet estimates.
Weekly claims data can be quite volatile and are frequently revised, and economists caution that some one-off influences — in this case, harsh weather and a new year — could be at play. Still, they also note that despite some broader economic uncertainty, the labor market remains solid.
“Most labor market indicators show progress toward a rebalancing in supply and demand, but that is happening without a rise in layoffs,” Matthew Martin, US economist with Oxford Economics, wrote in a note on Thursday. “Though seasonal factors overstate the drop, the low levels of claims suggest vacancies rather than employment continue to bear the burden of softening labor demand.”
It’s possible that severe weather across the Great Plains and the Northeast pushed claims lower, according to a note from Ian Shepherdson, Pantheon Macroeconomics’ chief economist.
“So a rebound in due course is a decent bet,” Shepherdson wrote, adding that it could take until February for that trend to become clearer.
“For now, we think the trend is broadly flat, in the low 200s,” he wrote. “The [Worker Adjustment and Retraining Notification] notices data point to a modest increase in the next couple months; but we see nothing yet in the hard data to change our view that [job growth] will rise by about 150,000 to 200,000 per month across the first quarter.”
Thursday’s report also showed that continuing claims, which are filed by people who have received unemployment benefits for at least one week or more, decreased to 1.806 million for the week that ended on January 6. Those totals are down 26,000 claims from the prior week’s downwardly revised level of 1.832 million.
Continuing claims, which could give an indication of how easy it is for unemployed workers to find jobs, are at their lowest level since October 2023.
This story is developing.