Continuing Jobless Claims at 44-year Low

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New claims for unemployment benefits fell by 4,000 in the week ending June 9 according to the weekly report from the U.S. Department of Labor. The seasonally adjusted total fell to 218,000 from the prior week’s unrevised total of 222,000. Economists were expecting the total to come in at 225,000.

The big news from the report is that the advance number for seasonally adjusted insured unemployment (also known as continuing claims) hit a near-45-year low of 1.697 million in the week ending June 2. The total represents a week-over-week drop of 49,000 and is the lowest level of insured unemployment since December 1, 1973 when the total hit 1.692 million.

On an unadjusted basis, actual claims under state programs totaled 213,698, up by 22,175 from the prior week. In the comparable week a year ago initial claims totaled 234,652.

The highest insured unemployment rates in the week ending May 26 were in the Virgin Islands (2.9%), Alaska (2.5%), New Jersey (2%), California (1.9%), Connecticut (1.9%), Puerto Rico (1.8%), Pennsylvania (1.7%), Illinois (1.5%), Nevada (1.4%), and Rhode Island (1.4%).

The largest increases in initial claims for the week ending June 2 were in Tennessee (+1,587), Illinois (+1,567), Ohio (+698), Arkansas (+387), and New Mexico (+353), while the largest decreases were in Michigan (-3,638), California (-1,938), New Jersey (-1,678), New York (-1,454), and Pennsylvania (-953).

Strong employment numbers like these show that the U.S. economy continues to grow at a steady pace. The Federal Reserve Bank Wednesday raised it economic outlook for 2018 to 2.8% from 2.7%. As Fed Chairman Jerome Powell noted on Wednesday, “Most people that want a job can find one.” At some point wages that have been largely stagnant  will have to rise in order for employers to attract workers.