Weekly Jobless Claims Rise, but Not Enough to Jolt Payroll Expectations

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Friday’s Employment Situation Report by the U.S. Department of Labor will be the biggest economic release in America this week. It also will be the last formal economic report of consequence that the public will get to see before the election.

Ahead of that report came a Labor Department release on weekly jobless claims. Claims were up to 265,000 in the week ending October 29. Bloomberg’s consensus estimate was 255,000 and the Econoday range of estimates was 254,000 to 265,000. This was also an increase of 7,000 from the previous week’s unrevised level of 258,000.

As we have seen in just about every report in 2016, no special factors had an impact on this week’s initial claims. This also marked the 87th consecutive week in which initial claims were below 300,000, and that is the longest streak since 1970.

The four-week moving average was 257,750, an increase of 4,750 from the previous week’s unrevised average of 253,000. Also reported was that the advance seasonally adjusted insured unemployment rate was 1.5% for the week ending October 22 (reported with a one-week lag), unchanged from the previous week’s unrevised rate.

Then there are the continuing claims, which we call the army of the unemployed. This is an advance number that is reported with a one-week lag. Continuing claims were down 14,000 to 2,026,000. While this may still sound like a large number, the reality is that this continuing claims figure was the lowest level for insured unemployment since June 10, 2000, when it was 2,020,000.

A separate report, which is not a government one, was the Challenger Job-Cut report, showing that there were 30,740 announced corporate layoffs in October. That was down from 44,324 in September and was the lowest reading since May, as well as the third lowest reading in over two years. This only tracks large layoff announcements so it is not always spot on.

Layoffs and jobless claims are still not enough to really cause much of a stir ahead of the payrolls report due in less than 24 hours. That being said, the weak ADP report from Wednesday may have lowered unofficial expectations.