The Economy

U.S. Weekly Jobless Claims Fall to 222,000

“The underlying trend in claims remains consistent with a strong labor market."
Matthew HellerDecember 27, 2019
U.S. Weekly Jobless Claims Fall to 222,000

U.S. jobless claims fell for a second straight week, rebounding from a big surge earlier in December as the labor market continues to show strength.

The Labor Department said initial jobless claims fell by 13,000 to a seasonally adjusted 222,000 in the week ended Dec. 21, following a revised 17,000 decline the previous week.

Economists polled by Reuters had forecast claims would fall to 224,000 in the latest week.

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The more stable monthly average of new claims, meanwhile, rose by 2,250 to 228,000, the highest level since mid-February. Claims had jumped 49,000 to 252,000 in the first week of December, apparently reflecting a late Thanksgiving Day this year compared to 2018.

“The underlying trend in claims remains consistent with a strong labor market,” Reuters said, noting that “Labor market strength is underpinning consumer spending, keeping the economy on a moderate growth path despite headwinds from trade tensions and slowing global growth that have weighed on manufacturing.”

In November, the U.S. unemployment rate fell back to 3.5%, the lowest in nearly half a century.

According to MarketWatch, “Economists don’t think the rise in the 4-week average this month is a sign of cracks in the wall of a strong labor market, but they are watching the data closely. For now, broader readings of labor market conditions remain quite positive.”

“It would be a mistake to read too much into the drop this week, the prior jump in claims a week ago or the dip to a 7-month low three weeks ago,” said Thomas Simons, senior money market economist at Jefferies. “Seasonal adjustment is difficult this time of year, and we expect that there will be a return to a center of gravity around 215,000.”

The latest claims report also showed the number of people receiving benefits after an initial week of aid fell 6,000 to 1.72 million while the four-week moving average of so-called continuing claims rose 19,250 to 1.70 million.