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Jobless Claims: Back Over 1.5 Million Unadjusted

July 16, 2020

Bottom Line: Claims were higher than expected again for the fifth time in six weeks as non-seasonally adjusted claims jumped back over 1.5 million. Seasonal adjustments are heavy this time of year, and production line overhauls by many automakers for new lines, including Ford's new 2021 F-150 (the best selling vehicle in the country) result in significant short-term layoffs. More importantly, there remains a huge backlog of jobless claims that are still being processed in many states. Overall, the trend is moving slowly lower but remains exceptionally elevated.

Our Nowcasting model, based on Google search data, predicted an increase in non-seasonally adjusted claims that was a touch more modest than the actual figure. It suggests the current week ending Saturday and reported next Thursday will still be near 1.44 million.

Jobless Claims FELL by 10k during the week ended July 11st to 1300k, compared with market expectations for an increase to 1250k.The 4-week average FELL by 60.0k to 1376k and the 13-week average FELL by 302.8k to 2250k.

Continuing Claims FELL by 422k during the week ended July 4th to 17,338k, after the prior week was revised moderately higher from 11,976k to 17,760k.The 4-week average FELL by 738k to 18,272k.

On a non-seasonally adjusted basis, Continuing Claims ROSE by 838k to 17,355k during the week ended June 27th.

The Insured Jobless Rate FELL by 0.3% to 11.9% during the week ended July 4th. The insured jobless rate only reflects the number of people collecting regular state unemployment insurance.

Article by Contingent Macro Advisors