The hope that the weekly jobless claims picture was getting better after last week’s surprise drop is being squashed. The Labor Department reported that weekly jobless claims rose back up into the danger zone this past week with a gain of 34,000 to 386,000. Bloomberg had estimates of 365,000 and the highest economist projection was 375,000. Today’s news represents the largest one-week gain in over a year, which just proves that the prior week’s reading was an aberration.
The prior week’s report also was revised higher by 2,000 to 352,000. The four-week average fell by 1,500 to 375,500. Another measurement of the continuing claims, the army of unemployed taking benefits for more than one-week, rose by 1,000 to 3.314 million.
Last week brought some hope that the layoffs were abating, but we suspected that the Fourth of July falling on a Wednesday played a huge role in the report. It is only that much more evident now. Back to more pain …
Layoffs are going to continue, and there seems little reason to see the unemployment rate improving from 8.2%.
JON C. OGG