Jobless Claims: Expect Sharper Decline Next Week

May 28, 2020
Bottom Line: Claims declined modestly last week to just 2.1 million on a seasonally adjusted basis, just below 2 million unadjusted. This was in line with predictions based on nowcasting with Google search data. Claims are now trending lower, albeit from a record high level, and continuing claims fell for the first time since the shutdowns for the novel coronavirus. The 4-week average is at 2.6 million, below the 13-week average that is now 3.19 million, indicating the labor market trends are improving modestly/improvement trend is losing momentum. Through last night, claims this week look to be tracking sharply lower. Our model suggests a decline to 1.5 million is possible for the report next week. Jobless Claims FELL by 323k during the week ended May 23th to 2123k, compared with market expectations for an increase to 2100k. The 4-week average FELL by 436.0k to 2608k and the 13-week average ROSE by 146.4k to 3191k. Continuing Claims FELL by 3860k during the week ended May 16th to 21,052k, after the prior week was revised moderately higher from 11,976k to 24,912k. The 4-week average ROSE by 760k to 22,722k. On a non-seasonally adjusted basis, Continuing Claims FELL by 3742k to 19,052k during the week ended May 9th. The Insured Jobless Rate FELL by 2.6% to 14.5% during the week ended May 16th. The insured jobless rate only reflects the number of people collecting regular state unemployment insurance.