U.S. jobless claims drop, signaling robust labor market

People cross the street in downtown Chicago. (Alexa Adler/MEDILL)
People cross the street in downtown Chicago. (Alexa Adler/MEDILL)

By Alexa Adler
Medill Reports

The number of Americans filing initial unemployment claims dropped slightly last week, signaling continued soundness in the labor markets.

The U.S. Department of Labor reported Thursday that for the week ended March 10, seasonally adjusted initial jobless claims decreased by 4,000 to 226,000 from the revised figure of 230,000 for the week ended March 10. The four-week moving average, which is considered to be a more reliable measure because it tends to not be as volatile as a one-week figure, was 221,500, a decrease of 750 from the prior week’s revised moving average of 222,250.

The initial claims were a bit more favorable than the economists’ consensus outlook of 229,000, reported by the Econoday Economic Report.

Weekly initial jobless claims have been below 300,000 for more than a year. Jobless claims, however, have increased by a modest amount from the 210,000 reported for the week ended Feb. 24, which marked their lowest level in nearly 50 years, according to MarketWatch.

A.G. Malliaris, The Walter F. Mullady, Sr. Professor at Loyola University Chicago’s Quinlan School of Business, characterized this report as being “wonderful” news for the economy. He went on to say that the jobless claims number “has come down from about 700,000 people per week losing their jobs during portions of the 2009-10 period to something like 220,000 people, which confirms that the economy continues to grow slowly but steadily at approximately 2 to 3 percent per year and it has been doing so for the past eight years.” Malliaris concluded that “The significance of this report is that the economy continues to be doing well and is not slowing down.” He attributed much of the economic growth to low interest rates over the past seven years.

Thomas Donley, professor and senior advisor to the dean of the Department of Economics at DePaul University, agreed that today’s jobless claims report was “a good number in terms of overall significance.” He went on to say that “The big question is whether or not we begin to see some wage increases.” Donley declined to predict any future trends in the labor market or the economy based on this report, noting that “There are too many wildcards right now.”

On a state-by-state basis, the largest increases in initial unemployment claims for the week were in New York, California, Washington, Texas and New Jersey while the largest decreases were in Massachusetts, Rhode Island, Kentucky, Michigan and Kansas.

Photo at top: People cross the street in downtown Chicago. (Alexa Adler/MEDILL)