There was enough weakness in this morning’s initial claims for unemployment number to raise a (so far very small) warning flag
Oh, those pesky revisions.
This morning’s stories on the initial claims for unemployment data released today say that claims declined to 359,000 for the week that ended on March 24 from 364,000 for the week that ended on March 17.
But the initial claims level only showed a drop because the Department of Labor revised the numbers for the previous week (the one that ended on March 17) upward. Without that revision, we’re looking at an increase in initial claims from the unrevised 348,000 for the week of March 17.
Why is this important?
Revisions like these that attempt to more accurately reflect seasonal factors are completely routine. But today’s batch of revisions now shows the four-week moving average, the less volatile measure that economists (and yours truly) urge you to watch instead of the week to week numbers, now shows that the four-week moving average for initial claims bottomed at 354,750 with the week ended on February 24.
Since then the four-week moving average has actually been moving upward. Last week, according to the revisions, the four-week moving average climbed above 360,000 for the first time since early February. The average now stands at 362,750.
This isn’t a huge change and statistical revisions have been less than accurate in this recovery, but still I’d be more comfortable if the trend were moving in the other direction.
In short, there’s nothing in today’s numbers to say that March job gains will fall short of the recent monthly pace of 200,000 net new jobs, but the trend in the four-week moving average for initial claims does bear watching.
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