During COVID-19, jobless claims have been a key measure of the US job market’s health. Recently, jobless claims have been circulating around 200,000, a sign that the US job market is at its healthy level. However, there are questions circulating about the data’s accuracy, specifically in revised seasonal adjustments. In fact, new seasonal adjustments mean that the official number of 228,000 was actually higher than what was originally estimated in the prior week, USN reported.
Jobless Claims Fall By 18K
The revised numbers show that jobless claims fell by 18,000, but the four-week moving average was 237,750, a decrease of 4,250 from the prior period’s revised number. Claims have been near the 200,000 mark in recent weeks, even as large companies such as GM, Amazon, and Microsoft have announced layoffs.
The new seasonal adjustments take into account some of the wide swings in employment data seen during the height of the pandemic, making comparisons to past reports difficult. The weekly number was 206,931, without the seasonal adjustment.
The jobless claims report comes just before the government releases its monthly jobs survey for March. Expectations are for a gain of around 240,000 jobs, a drop from the 311,000 posted in February. On Tuesday, new data indicated that the number of job openings decreased by approximately 700,000 to 9.9 million at the end of February, after the January figure of 10.6 million. This could indicate a potential deceleration in the pace of hiring.
The Federal Reserve is watching the labor market for signs that it is softening, as reduced demand for workers could ease pressure on wages, a key factor in inflation that the Fed would like to see lower. Private payroll firm ADP said that 145,000 jobs were created last month, well below expectations of an increase of 210,000. The yearly increase in wages also decreased from 7.2% in February to 6.9% in March.
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U.S. Labor Market Remains Strong
Despite evidence of a slowdown in hiring, the labor market remains strong by historical standards. According to LinkedIn’s Workforce Report for April, hiring in all sectors declined by 0.6% in March compared to February and has decreased by 28.2% from the previous year. Nevertheless, the decline of 0.6% was the least significant over the last 11 months.
In conclusion, the accuracy of jobless claims data remains uncertain due to revised seasonal adjustments. The government’s monthly jobs survey for March is expected to show a slowdown in hiring, which could ease pressure on wages and inflation. Despite this, the labor market remains strong by historical standards.
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