Jobless Claims: Surprise Decline

Bottom Line:  Claims fell sharply last week after two weeks of readings near the cycle high. These data were collected over the week including the Juneteenth holiday. Given the holiday is a new federal holiday that has yet to be adopted in some states (or a state holiday on Friday rather than Monday like in New Jersey), the seasonal adjustment models fail to capture the holiday adequately. California and Texas saw sharp declines in claims but states like New Jersey, and Connecticut saw increases. The trend remains to the upside, but there will be significant volatility for at least a few more weeks with Independence Day next week. While claims still point to a very slow loosening of historically tight labor markets,  we are monitoring the deceleration in continuing claims, which peaked in April.

Initial Jobless Claims FELL -26k in the week ended June 24th to 239k, BELOW the 4-week average of 257.5k, BELOW the 13-week average of 241.07692k but 26k ABOVE the year-ago level. Non-seasonally adjusted Claims FELL -17.843k.

Continuing Claims FELL -19k in the week ended June 17th to 1.742M, BELOW the 4-week average of 1.7575M, BELOW the 13-week average of 1.796231M but 402k ABOVE the year-ago level.