U.S. initial jobless claims dropped slightly in the week ending 03 September to 259,000 from 263,000. The decline is consistent with the consensus expectations of 265,000. The four-week moving average of claims were at 262,000. Continuing jobless claims also dropped a bit from 2.151million to 2.144 million in the week ending 27 August. The insured jobless rate continued to be stable at 1.6 percent. Overall, the initial jobless claims report indicates that the U.S. labor markets continue to improve.
Looking into the state-level data, Illinois and California had significant rises in weekly initial claims. Meanwhile, New Jersey, Michigan and New York witnessed huge decline in the initial claims. The rise in the initial claims in the past month was driven by energy intensive states.
A large increase in continuing claims was seen in North Dakota, probably because the energy sector continues to shed labor. Continuing claims in Missouri is expected to decline in the months ahead as the increase is probably mainly because of a surge in initial claims in July, noted Barclays in a research report.
In all, the outlook for employment seems optimistic. The ongoing fall in continuing and initial claims shows significant underlying strength in labor markets. The low level of initial claims indicates that workers are not losing jobs in huge numbers, whereas the low level of continuing claims shows that the workers that were laid off are possibly finding employment and are thus the unemployment insurance rolls, stated Barclays.
