New filings for unemployment declined last week, the Labor Department reports, delivering a bullish surprise relative to expectations for a slight rise. The news offers another upbeat clue for thinking that the economy’s recent stumbles are a temporary soft patch rather than the start of deeper troubles.
The crowd was projecting an increase of 2,000, according to Econoday.com’s consensus forecast. Instead, claims slid 9,000 for the week through Mar. 21. The latest update also marks the third week in a row of year-over-year declines of 9%-plus. If the US business cycle is headed for a dark spell, it’s not obvious in the jobless claims data.
That said, the strong downward trend for much of the past year has eased lately. Although claims slipped to a five-week low in today’s release, the trend over the last several months reflects volatility within a range of roughly 270,000 to 320,000. It’s unclear if this is a sign that the improvement in the labor market is slowing rather than a pause ahead of a spring revival that brings more encouraging numbers.
As for what we do know at the moment, jobless claims continue to point to continued growth for payrolls for the near term. The rate of increase may be slowing, but today’s update offers little support for expecting anything more than a mild deceleration in the macro trend for the immediate future.