Jobless claims decreased 9,000 in the April 7 week to 233,000 but are still trending slightly higher in what may be, at least possibly, a negative signal for the labor market. The 4-week average is at 230,000 which is roughly 10,000 above the month-ago trend. Readings in the 230,000 range, though very low and consistent with strong demand for labor, may mark a modest shift higher for layoffs which would be of no major concern if not for the slowing seen in March payroll growth to 103,000 following a long stretch averaging about 200,000 per month.
One factor that will limit the effect on expectations is that April, because of Easter shifts, can be a difficult time for adjustments. Still the rise underway in initial claims, though minimal, is not a positive for the outlook on the April employment report.
Continuing claims rose 53,000 to 1.871 million in lagging data for the March 31 week in a rise mitigated by a 2,000 decline in this 4-week average to 1.850 million. The unemployment rate for insured workers remains very low, at only 1.3 percent for the 6th reading in a row. There were no special factors in the week with, for the first time in a long time, no states estimated.
Initial claims are expected to come in at 230,000 in the April 7 week vs an outsized jump to 242,000 in the prior week. Even at 242,000, claims have been consistent with minimal layoffs and strong demand for labor.