A new report from the Bureau of Labor Statistics showed that first-time claims for unemployment benefits fell last week by 9K to 221K, significantly better than expected. That was also the 153rd consecutive week that initial claims have held below 300K, one of the longest such streaks on record and more impressive since the current workforce is much larger.
Moreover, the less volatile 4-week average for initial jobless claims declined last week to the lowest level since 1973, and initial claims as a percentage of the civilian labor force fell to a new all-time low. Altogether, these figures are consistent with an overall healthy labor market, and a shortage of skilled workers that is making companies hesitant to let employees go. Workers are starting to take notice, as evidenced by the ratio of quits to layoffs and discharges hovering near a record high. This highlights U.S. workers’ increased willingness to give up their current job security for better employment opportunities, which should put upward pressure on both wages and overall consumer inflation.
Sources: Econoday, U.S. DoL, FRBSLPost author: Charles Couch