New claims for unemployment benefits declined by 10,000 last week to 230,000, the lowest level in three weeks.
Unemployment claims are a proxy for layoffs. This year, employers have continued to add workers and post job openings at high levels, although both payroll growth and vacancies have fallen from last year’s levels. After a brief spurt of layoffs in technology and finance early this year, layoffs have remained very low in the U.S.
The numbers are seasonally adjusted. Before seasonal adjustment, claims fell by 15,466 to below 200,000, the lowest level since last November.
Continuing claims—those filed after the first week of benefits—fell by 9,000 to 1,702,000. This is low by historical standards and suggests that many workers are rapidly finding new jobs after being let go by downsizing employers. These are reported with a one-week delay.
The initial jobless claims are often a leading indicator for the economy, predicting increases in the unemployment rate and the direction of the overall economy. This year, claims have accurately indicated that a recession is not imminent.
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