Initial claims decreased by 22,000 to 187,000 for the week ending July 18, as per Labor Department data published on Thursday. The median expectation in a Bloomberg economist survey was 210,000 applications.
Continuing claims, which serve as a measure of those currently receiving benefits, remained relatively unchanged at 1.8 million from the previous week.
The low claim numbers imply that employers are hesitant to lay off staff. However, the jobs report from last month indicated that many Americans exited the labor force, which could also clarify the drop in unemployment insurance applications.
Insights from Bloomberg Economics…
“A larger-than-anticipated decline in initial jobless claims points to an imperfect seasonal adjustment process. Overall, the data further signify limited layoffs as the July 28–29 FOMC meeting approaches. Sustained corporate profit margins enable companies to invest while keeping staff, prompting the Federal Reserve to remain focused on inflation aspects of its dual mandate.” — Eliza Winger
When not adjusting for seasonal trends, initial filings declined by 53,718 to 192,296. New York reported the largest drop with a reduction of 16,954. Significant declines in initial filings were also seen in Michigan and California.
