Jobless Claims Stay Below Pandemic Level for Third Week

It’s a positive trend, but the holiday season means data is volatile

Businessman on Subway Wearing Mask

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The number of first-time claims for unemployment insurance last week was below pandemic levels for the third week in a row, suggesting a sustained labor market recovery.

Initial jobless claims for the week through Dec. 4 fell 43,000 to a seasonally adjusted 184,000, well below the prior week’s revised 227,000, the Department of Labor said Thursday. That was better than economists’ average forecast of 215,735 cited by Moody’s Analytics, and it was the lowest number of new claims since Sept. 6, 1969. 

The numbers show just how far the labor market has come since March 2020, when the pandemic first hit the economy and millions of jobs were lost in a matter of weeks. Claims for unemployment started to climb in the middle of that month,  to 256,000 for the week through Mar. 14, 2020. and peaked at 6.15 million at the beginning of April 2020.

Although the stats are looking good, economists remain cautious about the weekly data, noting that it can be volatile, especially around the holidays. The four-week moving average, which smooths out weekly volatility, is more telling, and it’s encouraging, Gus Faucher, chief economist at PNC Financial, said. That average fell in the latest week by 21,250 to 218,750, the lowest since Mar. 7, 2020.

“Demand for labor is very strong and workers are in short supply, so layoffs are very low,” said Faucher in a commentary. “Those workers who do find themselves unemployed can quickly find new jobs.”

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  2. St. Louis Fed. “Initial Claims.”