Initial Jobless Claims Drop to 305,000, One-Month Average at June 2007 Level

The string of the number of Americans filing for first time jobless benefits beating expectations continued again this week as two states worked to process all their claims after a computer upgrade three weeks ago impacted claims.

The Labor Department reported on Thursday that the number of initial jobless claims, a proxy of weekly layoffs, for the week ended September 21 totaled 305,000, a drop of 5,000 from the previous week’s revised number of 310,000 (revised up from 309,000).  Economists predicted claims to rise to 329,000.

Most analysts have been expecting sharp revisions to previous weeks after it was reported that California and Nevada didn’t get all their claims processed during the week ended September 7 because their computer systems were being worked on.  In that week, claims plunged to 292,000 from 323,000 the week earlier, marking the smallest number of weekly claims since April 2006.  The sharp revisions have not come, though, as the missing claims were added to totals, indicating that employers are keeping full staffs and seem to have an optimistic view of the future at this point.

The Labor Department said that California and Nevada are now all caught-up in filing claims.  There were no special factors in the latest claims totals and no states were estimated.

The four-week moving average, a less volatile measure of labor trends, dropped to 308,000 from a revised average of 315,000 (revised up from 314,750).  That’s the lowest level since June 2007.  Economists generally regard claims of 350,000 as moderate growth in the jobs market.

Continuing claims, or the number of people already receiving jobless benefits in state programs, in the week ended September 13 increased to 2.823 million from 2.787 million in the week previous, modestly topping economist forecasts of 2.818 million.  Continuing claims are reported at a one-week lag to initial claims.

The total number of people collecting claims across all state and federal programs rose by 22,769 to 3.921 million in the week ended September 7.  Total claims are reported at a two-week lag.  Compared to the same time in 2012, total claims were lower by 1.253 million, or 24.2 percent.

The largest increases in initial claims for the week ending September 14 were in California (+22,611), Florida (+3,946) and Georgia (+2,690).  The largest decreases were in Oklahoma (-439), Tennessee (-404) and Kansas (-351).

Futures on Wall Street are looking up after a week’s worth of red closes with the better-than-expected report.  The Dow is looking to open ahead by 27 points, the S&P 500 by 3 points and the Nasdaq by 13 points.