In this morning’s data, Initial Jobless Claims were 199,000 for the week ending December 27th, less than as expected and -16,000 less than the revised amount from the previous week. In addition, Continuing Claims were 1,866,000 for the week ending December 20th, also less than expected and -47,000 less than the previous week’s figure.
Initial Jobless were less than expected and remain at a healthy quantity, well below the 300,000 top threshold which many consider appropriate for a functioning labor market. Initial claims and have been in the low to mid-200,000 range for many weeks. Meanwhile, continuing claims ticked lower from the previous week and are near where they were at the start of the year.
Overall, the weekly claims data denote relative stability for the labor market; even as the unemployment rate ticked higher in recent data as more individuals have entered the labor force. The availability of work in the new gig economy in areas such as ride sharing, food delivery, and independent contracting may provide another avenue for individuals to consider rather than filing for traditional unemployment benefits. Given these dynamics and their possible impact on initial and continuing claims, upcoming payrolls and related data will be a key focus for the Fed and for the economy in the coming weeks.
In all, the yield on the 10-year US treasury ticked higher following the release of the claims data and equity futures are lower as we head into the market open. We wish everyone a safe and happy New Year!
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