Jobless claims: Yellow flag for attention continues

– by a New Deal Democrat

In response to last week’s big jump in new jobless claims to 264,000, I wrote that this could be a departure from the start of an uptrend. This morning, claims are back to their previous average range of 242,000. The 4-week average is down -1,000 to 244,250, while ongoing claims from the previous week are down -8,000 to 1.799 million:

I pay particular attention to the year-over-year change because that’s what triggers a recession warning from this metric: specifically, 2 months in a row of claims higher than 12.5% ​​year-over-year.

As of this morning’s update, the weekly number is 9.0% higher year over year and ongoing claims are 25.5% higher. The all-important 4-week average is 14.0% higher:

The 4-week average has reached the %age mark, but has not stayed above it long enough to generate a red flag. In the past (not shown), so often that readings of this kind that did not persist were false positives. So for now the yellow flag caution remains.

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