Jobs Market Keeping US Economy Afloat
Skerdian Meta • 2 min read
The jobs market has been solid in the US despite the headwinds domestically and globally, which have hit other sectors, with manufacturing already in contraction. Jobs have been increasing, keeping the US consumer spending, which in turn has been keeping the economy expanding, as yesterday’s GDP report showed, coming at 2.1%.
There was a scare about the labour market when the JOLTS jobs openings tumbled early this month. But, the following jobs reports have been solid. Last week’s initial jobless claims report fell to 201K, while this week it came at 204K, below expectations, as shown below.
Unemployment benefits are still required by around 1.6 million people, down from a peak of 1.86 million by the middle of April. The unemployment rate unexpectedly climbed to 3.8% in August, up from 3.5% in July, the highest level since February 2022 although the jump is linked to an increase in labor force participation and markets have been brushing it under the carpet.
US Initial Jobless Claims and Continuing Claims
- Initial jobless claims 204K vs 214K est.
- Prior week jobless claims 201K revised to 202K
- 4-week moving average initial jobless claims 217.25K vs 217.0K last week.
- Continuing claims 1.670M vs 1.675M estimate. Prior week revised to 1.658M from 1.662M previously reported
- 4-week moving average of continuing claims 1.674M vs 1.686M prior week
- The largest increases in initial claims for the week ending September 16 were in Georgia (+1,539), New York (+1,332), South Carolina (+1,103), Texas (+987), and Oregon (+557),
- The largest decreases were in Indiana (-2,761), California (-1,498), Virginia (-631), Iowa (-558), and Kentucky (-375).
The jobless claims data continue to show a strong employment picture. It may be that job losses are at the higher end of the pay scale, but the lower-level jobs continue to be in demand. This is keeping the USD bullish, which is advancing against the Euro and the commodity dollars.