Jobless Claims Add More Base for Strong Payrolls and Unemployment Report

Another solid jobs number is setting the tone for Friday’s unemployment and payrolls report. The U.S. Department of Labor reported that weekly jobless claims for the week of December 2 fell by 2,000 to 236,000. The week of November 25 was left unrevised. Economists surveyed by Dow Jones had a consensus estimate of 236,000 and Thomson Reuters had a consensus estimate of 240,000.

The four-week average, which aims to smooth out weekly volatility (particularly around holidays and other circumstantial issues) fell by 1,000 to 241,500.

Where this report showed some additional strength that may help the payrolls and unemployment report due on Friday is in the continuing jobless claims for the week of November 25. This comes with a one-week lag, so it was all in November. Continuing claims fell to 1.908 million from 1.96 million.

According to the Bureau of Labor Statistics (BLS) report, the advance seasonally adjusted insured unemployment rate was 1.4% for the week ending November 25. This was unchanged from the previous week’s unrevised rate. Also one point was made about some continued disruptions from hurricane damage. The BLS noted that its “claims taking procedures” continue to be disrupted in the Virgin Islands and that the claims taking process in Puerto Rico has still not returned to normal.

The weekly claims was not the only report that offered support for a solid employment situation report this week from the Labor Department. ADP forecast earlier this week that private sector payrolls rose by 190,000 in November. That was marginally above the consensus estimates.

As far as Friday’s key jobs report, Dow Jones has the following consensus estimates:

  • Unemployment expected to be 4.1%
  • Nonfarm payrolls expected 195,000
  • Average hourly earnings +0.3%