Initial Jobless Claims Fall For First Time In 4 Weeks
Last week, jobless claims fell 38,000 to 326,000 representing the first decrease in almost a month the Bureau of Labor Statistics reported this morning.
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The 4-week moving average was 344,000, an increase of 3,500 from the previous week’s revised average.
The largest increases in initial jobless claims for the week ending Sept. 25 were in California with 9,907 claims and Michigan with 6,115 claims.
Claims up-ticked in September largely due to accounting issues in California and supply shortages in Michigan that led to short-term layoffs in the automotive industry, the Wall Street Journal reported.
California is now on its third round of state stimulus payments, the only state in the country to currently provide stimulus money from its own state fund. Income thresholds are similar to those from the federal stimulus payouts, and in the amounts of either $500 or $600.
Texas, The District of Columbia and Minnesota also contributed to the largest increases with 4,625, 2,223, and 2,002 respectively.
The unemployment rate also slightly ticked down, with the advance unadjusted insured unemployment rate decreasing .1 percentage point in the week ending Sept. 25 from the week prior.
Initial unemployment claims also act as a proxy for layoffs. The first decrease in unemployment claims in four weeks suggests that employers are keen to hold on to their employees in a tight labor market. Employers throughout the country have complained for months that they are unable to fill open positions and have blamed pandemic-era assistance programs as the reason workers are unwilling to return to work. Most of these programs ended in September along with the federal government unemployment insurance.
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Some of these programs included unemployment insurance for gig workers and others who were typically not eligible to receive unemployment insurance. Now that these programs have ended, these workers might be forced into other employment, potentially loosening the tight labor market that has plagued the U.S. employment situation for the better part of 2021.
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