For the week ending October 14, the anticipated value for seasonally adjusted initial claims was 198,000, a decrease of 13,000 from the previous week’s revised level.
The previous week’s level was revised upward by 2,000, from 209,000 to 211,000. The 4-week moving average was 205,750, a decrease of 1,000 from the previous week’s revised average.
The previous week’s average was revised upward by 500, from 206,250 to 206,750.
So far there has been a limited impact from the United Auto Workers (UAW) strikes, which have disrupted supply chains. Ford Motor, General Motors and Chrysler-parent Stellantis have furloughed and laid off thousands of non-striking workers.
The Federal Reserve’s Beige Book report on Wednesday said “labor market tightness continued to ease across the nation” in early October and implied cooling wage pressure. According to the Beige Book “several districts reported improvements in hiring and retention as candidate pools have expanded,” but also noted that “most districts still reported ongoing challenges in recruiting and hiring skilled tradespeople.”
The labor market is showing strength despite the U.S. central bank raising its benchmark overnight interest rate by 525 basis points to the current 5.25%-5.50% range since March 2022. It is driving consumer spending and the overall economy, ultimately keeping inflation elevated, leading many economists to expect that the Fed could leave interest rates higher for longer.
The claims report covered the week during which the government surveyed business establishments for the nonfarm payrolls component of October’s employment report. Claims fell between the September and October survey periods. The economy created 336,000 jobs in September, the most in eight months.
Data next week on the number of people receiving benefits after an initial week of aid, a proxy for hiring, will shed more light on the health of the labor market in October. The so-called continuing claims increased 29,000 to a still-low 1.734 million during the week ending Oct. 7, the claims report showed.