Initial Job Claims Fall in US, Boasting Strong Labor Market

Unemployment benefit applications in the United States fell last week, signaling continued strength in a labor market that has had a bit of a rough go the past few years.  According to the United States Department of Labor, initial claims for state unemployment benefits declined by 13,000—to a seasonally adjusted 222,000—for the week ending December 21.  

Some economists had originally expected unemployment benefit claims would fall to 224,000 that week so these numbers are a bit better.  Of course, it is not always easy to predict such numbers during the often volatile weeks at the end of the year.  And this year, in particular, has been tough to anticipate.

As such, the respectable drop in applications during the most recent week has largely helped quell the much bigger surge in claims from the two weeks prior. These numbers came after a later-than-usual Thanksgiving Day which, analysts suggest, might have thrown of the usually effective model that strips away typical seasonal fluctuations in data. 

All this said, the four-week moving average for initial claims—first time claims for unemployment benefits are a better measure for labor market health as they help to flatten out weekly volatility—eked up by 2,250 to 228,000.  This remains consistent with a strong labor market. 

However, the report—which was released on Thursday—also showed that the number of people receiving benefits after their first week of aid fell by 6,000, to 1.72 million for the second week of December.  That brings the four-week moving average for “continuing claims” up by 19,250 to 1.70 million.