An Interesting Divergence Between Initial and Continued Unemployment Claims

Initial unemployment claims keep rising. The 4-week moving average is the highest since November 13, 2021. Continued claims are another story.

Initial Claims Data from the Department of Labor, chart by Mish

• In the week ending June 17, the advance figure for seasonally adjusted initial claims was 264,000, unchanged from the
  previous week’s revised level.
• The previous week’s level was revised up by 2,000 from 262,000 to 264,000.
• The 4-week moving average was 255,750, an increase of 8,500 from the previous week’s revised average. This is the highest level for
  this average since November 13, 2021 when it was 260,000. The previous week’s average was revised up by 500 from 246,750 to 247,250.

Initial Claims 4-Week Moving Average

Continued Claims

• The advance number for seasonally adjusted insured unemployment during the week ending June 10 was 1,759,000, a decrease of 13,000 from the previous week’s revised level.
• The previous week’s level was revised down by 3,000 from 1,775,000 to 1,772,000.
• The 4-week moving average was 1,770,000, a decrease of
• 7,500 from the previous week’s revised average. The previous week’s average was revised down by 750 from 1,778,250 to 1,777,500.

Continued Claims 4-Week Moving Average

Divergence Between Initial and Continued Claims

Continued claims normally follow initial claims with a lag. Some people find jobs quickly, but others don’t. If initial claims are trending up, the normal pattern is for continued claims to do the same.

However, the 4-week moving average of continued claims is down for the second consecutive week. The current level is 1.770 million, down from a recent peak of 1.833 million for the week ending April 15. The moving average is below the level of 1.793 million on march 18.

I suspect seasonal adjustments may have distorted things. The rosy interpretation is that unemployed persons are either retiring or accepting jobs at a rate similar to those being laid off.