Despite Slight Weekly Increase, Jobless Claims See Historic Low
Following three weeks of declines in the number of U.S. workers filing first-time jobless claims, figures increased slightly for the week ending August 25th. Although the seasonally adjusted 213,000 claims marked an increase of 3,000 from the prior week, its still below the 215,000 that had been anticipated. Moreover, when you look at the four-week average, claims are at a historic low not seen in decades.
As the Wall Street Journal reports, the four-week moving average of claims actually fell to 212,250. According to the Labor Department, the last time levels were this low was in December 1969. This impressive stat demonstrates just how low the current layoff rate is among U.S. businesses. In addition to the strong economy as a whole, part of the reason for the lack of layoffs is the on-going skilled worker shortage, which could have company’s thinking twice about letting workers go — even during slower times. However, as MarketWatch notes, those “slow times” are affecting few businesses at the moment.
News of the impressive feat comes just days after some other great economic news. After it was initially reported that the nation’s gross domestic product (GDP) increased by 4.1% in the second quarter of the year, that figure has now been adjusted upward to 4.2%. You may recall that, when the 4.1% growth was announced, President Trump touted the gain in a press conference, saying, “We’re on track to hit the highest annual growth rate in over 13 years. And I will say this right now and I will say it strongly, as the deals come in one by one, we’re going to go a lot higher than these numbers, and these are great numbers.” Speaking of the President, it all seems like he’s getting closer to replacing NAFTA with a new trade deal, announcing that Mexico and the U.S. had reached a tentative agreement, with Canada now invited to join. While such a deal would essentially amount to an updated version of NAFTA, Trump says he’s moving away from that name, citing the negative connotation it carries.
Of course, with all this “winning,” economists warn that a recession could be around the corner. In fact, as MarketWatch reports, the current level of optimism observed in the economy could signal that a recession is “imminent.” They note that consumer confidence in August was the highest since October of 2000. Additionally a survey by the American Association of Individual Investors found that 43.5% of respondents were bullish on the market. This has led investment strategist Willie Delwich to declare “Optimism [is] getting excessive” while Deutsche Bank Securities chief international economist Torsten Sløk warned that confidence had reached “levels normally indicating a recession is imminent.”
There seems to be a recurring theme to the economic news these days: it’s good right now, but just wait. Perhaps that’s the nature of the beast but the long-term outlooks can sometimes obscure the short-term achievements that are worth celebrating (or at least noting). Regardless of who should get credit for what, how significant certain numbers are, or what may be ahead, it seem have to been a good week for the U.S. economy — here’s hoping it lasts.