Thursday, October 7, 2010

Falling jobless claims suggest firming activity

Yesterday's report by ADP that the economy shed 39,000 in September reflects what happened last month.  Released early this morning, weekly jobless claims measure what occurred during the week ended October 2, and the 11,000 drop to 445,000 puts claims back at the low end of the late 2009 – 2010 range.

image

As I discussed with the ADP report yesterday and will repeat here, most economic data are not signaling a new recession, and the recent downward trend in the very timely jobless claims report is a strong signal that the economy is slowly improving.

That said when jobless claims are released prior to the labor report, which will be out tomorrow, the data normally take a backseat to what will happen with unemployment and nonfarm payrolls.

The labor report shouldn’t be ignored but what weekly jobless claims are telling us about the economy is also relevant.

0 comments: