U.S. Jobless Claims Fall to 49-Year Low Despite Federal Shutdown

Filings for U.S. unemployment benefits fell last week to the lowest level since 1969, signaling the labor market remains tight despite the partial federal-government shutdown.

Jobless claims declined 13,000 to 199,000 in the week ended Jan. 19, bucking economist forecasts for an increase, Labor Department figures showed Thursday. The four-week average, a less-volatile measure, decreased to 215,000, the lowest since early November.

Key Insights

  • The surprise drop indicates how reluctant employers are to fire workers, with the strength overshadowing the shutdown affecting one-quarter of the government. In any case, the closure is seen reducing economic growth the longer it drags on.
  • Initial filings by federal employees jumped by about 15,000 to 25,419 on an unadjusted basis in the week ended Jan. 12, reflecting the third week of the shutdown that’s caused pay to halt for hundreds of thousands of workers. Those figures aren’t included in the headline claims number, which reflects state unemployment-insurance programs.
  • Analysts caution that it may take more time for the shutdown to be fully reflected in the report, and data on federal employees are reported with a lag.

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  • Initial claims were estimated in six states last week, including California, the most populous state, and Virginia, where many federal workers live. Other estimates included Hawaii, Kansas, North Dakota and West Virginia.
  • Continuing claims, which are reported with a one-week lag, fell by 24,000 to 1.713 million in the week ended Jan. 12.
  • Initial claims were the lowest since November 1969. Claims had previously reached as low as 202,000 in the past year.
  • The unemployment rate among people eligible for benefits held at 1.2 percent for a seventh week.
  • The previous week’s claims were revised down to 212,000 from 213,000.

 

 

via: https://www.bloomberg.com/news/articles/2019-01-24/u-s-jobless-claims-fall-to-49-year-low-despite-federal-shutdown
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