Jobless Claims: Sharp Increase

Bottom Line:  Claims were sharply higher than expected at 261k, the highest since October 30, 2021. Claims in Ohio jumped over 60%, accounting for over 25% of the total increase in the week. While volatility in an individual state is not unusual, especially one with many jobs in manufacturing related to the auto industry, it bears close watching in the coming week. For now, the sharp increase does not appear to be due to fraud, like the increases we saw in Massachusetts in April and May. Overall, claims are trending slowly higher, suggesting a very slow slackening in a historically very tight labor market. But these latest tallies have us on high alert for an acceleration in the pace of claims -- for now, it is too early to make that claim. That said, our Nowcast model continues to run modestly above the reported level of claims.

Initial Jobless Claims ROSE 28k in the week ended June 3rd to 261k, ABOVE the 4-week average of 237k, ABOVE the 13-week average of 238k, and 40k ABOVE the year-ago level. Non-seasonally adjusted Claims ROSE 10.535k,Continuing Claims FELL -37k in the week ended May 27th to 1.757M, BELOW the 4-week average of 1.78475M, BELOW the 13-week average of 1.805462M but 375k ABOVE the year-ago level.