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First Cut: Initial jobless claims remain low in March 7 week

Initial jobless claims declined 4,000 in the week ended March 7 to 211,000 after a revised 215,000 in the prior week (previously 216,000). The four-week moving average ticked up 1,250 to 214,000, not materially different from the headline. Unadjusted claims essentially retraced the increase in the prior week and fell 16,823 to 200,159 in the March 7 numbers.

The Labor Department cited no special factors and only Alabama had an estimate for claims. Unadjusted claims levels were somewhat below expectation.

Beyond the normal week-to-week variation, claims numbers have remained reasonably steady and comfortably cruising a little above the 200,000-mark. There is no immediate sign of deterioration related to the spread of COVID-19. However, the next week’s report is likely to see a hefty increase. Some school districts and larger college campuses are shuttering classroom for a couple of weeks to mitigate the spread. This likely means that custodial staff and other support services will be scaled back. Businesses in the hospitality sector may also be laying off workers who are not needed as event venues are idled.

The Labor Department will release its annual revisions and updated seasonal adjustment factors with the data on March 19.

Continuing claims for unemployment benefits reversed the increase of the prior week and fell 11,000 to 1.722 million in the February 29 week. The insured rate of unemployment was unsurprisingly still at the 1.2% that has predominated for about 22 straight months. It will probably be a week too early in the next report to see impacts from layoffs related to precautions in front of the coronavirus spread, but these are likely to arrive in the near future.

 

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