The US Department of Labor released data showing that 584,000 people filed initial claims for unemployment insurance this past week. This is up sharply from the upwardly revised 559,000 last week and 524,000 two weeks ago. The past two weeks’ data were artificially low due to shifts in auto plant production schedules. Now, the data are normalizing back to a trend above 550,000 weekly initial claims, a figure that should still be considered indicative of a week labor market.
Nevertheless, the widely followed 4-week average has been moving down steadily. For seasonally-adjusted claims, we have seen a downward trend for sixteen consecutive weeks now. In addition, the actual claims numbers from this past week were unusually low, with barely over 500,000 filing for claims and continuing claims down to just over 6 million (see red areas in figure above).
On the other hand, continuing claims have only just started down (and this does not include the additional claims mandated under the February stimulus package). Average initial claims are only down 100,000 from the peak, which is an unusually low figure after 16 weeks of declines.
The trend is down for jobless claims. But, this is not a V-shaped labor market recovery.