Initial jobless claims in the week ended February 9 were up 4,000 to 239,000 after 235,000 in the prior week (previously 234,000). The increase was contrary to market expectations where claims were expected to abate after the severe cold weather lifted in most of the Midwest and the end of the partial federal government. However, there appears to be some lingering effects. It may be that some contractors have continued laying off workers until payments are received or delays in implementing contracts have caught up and/or it is clear that another shutdown will not take place.
In the historical context, overall claims remain low and in line with a healthy labor market, but it is possible that the underlying trend is going to be somewhat higher than the recent bottom at the 200,000-mark in the January 19 week.
Continuing claims were up 37,000 to 1.773 million in the February 2 week, suggesting that workers affected by the shutdown have not been promptly recalled, or that outside laborers were still prevented from working a bit longer than expected. Nonetheless, the insured rate of unemployment remained at 1.2% for an eleventh straight week indicating no fundamental change in underlying conditions.
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