Initial Unemployment Claims remain low
If it is Thursday, it is Initial Unemployment Claims time; how many of our fellow Americans lost their job last week and filed for unemployment insurance. For the week ending June 4, 2016 264,000 Americans filed for initial unemployment claims, better than expected and still pegged at lows not seen since the early 70's.
Initial market reaction was muted though resulted in lower stocks, stronger dollar, lower oil, and interest rates moved lower still.
Claims continue to signal a dichotomy between layoffs and job creation. While claims signal labor market strength, non-farm payroll growth continues to signal labor market weakness. There is constant churn in such a large labor market like the U.S,, so each week Americans will lose their jobs. The problem is job creation just isn't what is used to be.
As the U.S. nears recession after 7 years of a below potential expansion, the race is on. Will claims turn higher before net job growth turns lower?
Structural barriers to job creation remain, and they are found on Capitol Hill and at the Fed's HQ in DC.