Initial claims edge lower, but still much work to be done

Initial jobless claims fell last week for both regular and pandemic programs, hinting at some improvement in labor conditions. Continuing claims, however, remain stubbornly high.

Somewhat Better

The 860K figure for initial jobless claims during the week of Labor Day was down from an upwardly revised figure of 893K the prior week. Claims for the PUA program also fell.

Today's data is somewhat more consequential as it overlaps with the payroll survey week. The recent change in the seasonal adjustment process suggest the 244K drop between survey weeks overstates improvement—NSA claims fell by 100K.

Continuing Claims Show Essentially No Improvement

Continuing claims for regular state programs fell by about 1M the week of Sep. 5, but that comes as we are now a full six months from the start of shutdowns, and recipients are starting to exhaust benefits. The total number of recipients, including extended or pandemic-specific benefits, remains stuck at nearly 30M. While the PUA may not be the best gauge of underlying labor conditions, the stubbornly total underscores the labor market is still reeling.

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