The Department of Labor this morning reported a seasonally adjusted rise of 24,000 to 399,000 in first-time applications for unemployment benefits for the week ending Jan. 7. The four-week moving average preferred by many economic analysts because it flattens volatility rose to 381,750 from the previous week's revised average of 374,000. A year ago at this time the weekly number was 437,000 and and the four-week running average was 420,000.
The significant jump could be an indication that temporary hiring of package delivery personnel and retail workers in December was larger than expected. The median forecast of the 46 analysts surveyed by Bloomberg was 375,000. The rise could be bad news for a labor market that has been improving at a slightly accelerated rate the past few months. The claims figures, like other job reports, are especially volatile around the holiday season. The first week of the year typically shows a high number of claims.
“Labor demand is still not strong enough to support a complete jobs recovery,” Henry Mo, an economist at Credit Suisse in New York, said before the report. Even so, “the labor market is heading in the right direction.”