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To describe the current situation in the US labor market as stable seems to be an understatement given the latest data from the Department of Labor.
That’s because most of the last few weeks have shown that the number of initial jobless claims hasn’t fluctuated at all – around zero.
In five of the past six weeks, the number of initial applications for unemployment benefits was exactly 212,000. With a workforce of 168 million people, reaching such a standstill seems at least unusual, if not scary, but that’s what figures released every Thursday morning since mid-March show.
The consistency has raised some eyebrows on Wall Street. The only week where there was a difference was March 30 with 222,000.
“How is this statistically possible? Five of the last six weeks, exactly the same number,” market veteran Jim Bianco, head of Bianco Research, posted on X on Thursday.
“Initial applications for unemployment insurance are state programs with 50 state regulations, hundreds of offices and 50 websites to submit. Weather, seasonality, holidays and economic fluctuations determine the number of people who file claims week after week,” he added. “Nevertheless, this measure is so stable that it does not fluctuate even at 1,000 applications per week.”
Others also got involved.
“Invented numbers,” said one thread participant, while another said, “Someone’s ruining the books.”
However, others expressed more analytical considerations and attributed the consistency of the data to seasonal adjustments. Tracey Ryniec, a strategist at Zacks Investment Research, suggested: “You can look at every state, Jim. These vary greatly.”
In fact, a Labor Department spokesman noted that while the series of 212,000 prints in the jobless claims data was “unusual,” it was not considered unusual.
The increase “can reasonably be interpreted as an indication that there was very little volatility in initial claims during this period compared to historical patterns and that the seasonal adjustment factors effectively remove seasonality from the overall numbers reported by states,” the said Officer .
Additionally, non-seasonally adjusted claims showed significant fluctuations during the five-week period, recording values of 202,722; 191,772; 193,921; 197,349; 215,265 and 208,509.
Federal Reserve officials are watching the weekly claims numbers as part of their broader assessment of the labor market, which has shown surprising resilience amid the central bank’s tightening of monetary policy.
The Labor Department official also noted that new seasonal factors for claims data were announced a month ago.
“Taking the new seasonal adjustment factors into account, initial applications have been at a fairly constant level since around mid-September 2023 and even more so since the beginning of February 2024,” said the spokesman.
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2024-04-19 16:26:09
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