Jobless claims unfortunately spiked higher in the May 11 week, up 32,000 to a 360,000 level that's the highest since late March. There are no special factors to explain away the gain that lifts the 4-week average by 1,250 to 339,250 which, despite the increase, is still more than 20,000 below the month-ago trend to hint at improvement for the May employment report.
Showing clear improvement are continuing claims which are down 4,000 in data for the May 4 week to a recovery low of 3.009 million. The 4-week average is down a very sizable 21,000 to a recovery low of 3.015 million with the unemployment rate for insured workers unchanged at a recovery low of 2.3 percent.
Weekly data are always volatile but initial claims had been, at least up until the latest week, showing consistent improvement since early April. Today's results are a disappointment that put special emphasis on next week's report which will match the sampling period for the monthly employment report.
Market Consensus before announcement
Initial jobless claims declined 4,000 in the May 4 week to a new recovery low of 323,000. Initial claims have been on a recent down trend as for the two prior weeks, initial claims fell a combined 28,000 which is a very significant drop. The four-week average was also down for a third straight week and is also at a recovery low, at 336,750 for a 6,250 decline.
New unemployment claims are compiled weekly to show the number of individuals who filed for unemployment insurance for the first time. An increasing (decreasing) trend suggests a deteriorating (improving) labor market. The four-week moving average of new claims smoothes out weekly volatility. Why Investors Care