The Labor Department said in its weekly report on Thursday that the number of Americans filing for first time unemployment benefits dropped by 27,000 to a seasonally adjusted 341,000 in the week ended February 9 to stay near five-year lows. Economists were expecting a smaller decline in claims of 8,000 to 360,000 from the prior week.
The caveat is that the latest figures could have been distorted by Nemo, the winter storm that pounded New York and New England, possibly preventing some people filing for claims. The blizzard, which dropped more than two feet of snow in some areas, led to road and state employment office closures.
Because a lot of people file claims via phone or Internet, it is difficult to discern how much the jobs market improved based on the info from last week. Economists will be watching closely in coming weeks for sustainability as well as looking to the four-week moving average, generally a better barometer of overall labor trends because it eliminates weekly volatility.
In today’s report, the one-month average rose modestly by 1,500 to 352,500.
Meanwhile, the Labor Department revised their estimate of initial claims for two weeks ago upward to 368,000 from the first reading of 366,000.
The total number of people claiming benefits in all programs for the week ending January 26 was 5,918,156, an increase of 327,676 from the previous week. By comparison, there were 7,681,411 persons claiming benefits in all programs during the same week of 2012.
Continuing claims, or those people who have already been receiving benefits for more than one week, declined by 130,000 to 3.1 million during the week ended February 2. Continuing claims are reported at a two-week lag.
There is some consistency being established with initial jobless claims lingering in the area of 350,000 to 390,000 weekly and the hiring activity that has been averaging about 177,000 new jobs each month. To that end, economists will be evaluating the initial claims level over the next few weeks in anticipation of the next jobs situation report early in March to see if the nation’s unemployment rate can be pulled-down from 7.9 percent.
Wall Street is trading pretty flat as the Dow continues to sputter trying to break through and hold above 14,000 without a strong catalyst. Heading into lunch, the Dow is off by just 12 points, the S&P 500 is down less than 1 point and the tech-rich Nasdaq is down 2 points.