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First Cut: Initial jobless claims steady in August 31 week, but that may not last

Initial jobless claims were steady in the August 31 week, up a scant 1,000 to 217,000 from the prior week. Claims were in line with the underlying trend in the four-week moving average which rose 1,500 to 216,250. The Labor Department reported no special factors behind the numbers. However, the reporting period was going into the Labor Day weekend and four states and Puerto Rico had estimated claims numbers. The states were California, Hawaii, Kansas, and Virginia.

Next week is probably too soon to anticipate major impacts from Hurricane Dorian as it churns its way along the Eastern seaboard. Many coastal areas would have already started to shutdown summer venues and Dorian’s arrival would only mean it was sped up a day or two. If the large, slow storm dumps significant rainfall in the Southeast, it may result in layoffs in the week or two thereafter. However, given the reports of increased layoff intentions that emerged in August, the trend is likely to be higher for claims numbers even excluding weather impacts.

Continuing claims data fell 39,000 to 1.662 million in the August 24 week, unwinding the increase in the prior week. The insured rate of unemployment remained at 1.2% where it has been since May 2018.

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