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Initial jobless claims fall to pandemic low of 385,000

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As the American economy moves toward its full capacity to produce, the labor market continues to improve. First-time jobless claims fell to a pandemic low of 385,000 for the week ending May 29, according to government data released on Thursday.

This report is another in a series of encouraging jobs data that strongly implies that the economy is transitioning from recovery to expansion and moving back toward full employment. We expect the economy will return to full employment—an unemployment rate somewhere between 3.5% and 4%—in 2022.

While the initial jobless claims report is encouraging, there are still 15.4 million people on some form of unemployment insurance, including 3.46 million on regular state benefits, 6.3 million on federal Pandemic Unemployment Assistance and 5.29 million on Pandemic Emergency Unemployment Compensation.

There were 76,098 filings for new Pandemic Unemployment Assistance, and 3.7 million people filed continuing claims for the week ending May 22. It is important to note that Thursday’s data will not affect the initial estimate for the May jobs report, which will be released Friday by the Bureau of Labor Statistics. Claims for the week ending May 29 will influence the June jobs report.

For more information on how the coronavirus pandemic is affecting midsize businesses, please visit the RSM Coronavirus Resource Center.

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About Joseph Brusuelas

@JoeBrusuelas

Joe Brusuelas, “chief economist to the middle market,” is the preeminent voice championing issues and policies facing midsize companies in the United States and around the world. An award-winning economist, Brusuelas has more than 20 years’ experience analyzing U.S. monetary policy, labor markets, fiscal policy, international finance, economic indicators and the condition of the U.S. consumer.

A member of the Wall Street Journal’s forecasting panel and the UCLA Anderson School of Management's Board of Directors, Brusuelas regularly briefs members of Congress and other senior officials regarding the impacts of federal policy on the middle market and the factors by which middle market executives make business decisions. He also frequently offers his insights on the U.S., Canadian and global economies in the financial media. In 2020, he was named one of the 100 most influential economists by Richtopia. In December 2023, Brusuelas and the economics team were recognized on Bloomberg's list of Best Bond Forecasters after correctly predicting where the benchmark Treasury would end the year.

Before joining RSM in 2014, Brusuelas spent four years as a senior economist at Bloomberg L.P. and the Bloomberg Briefs newsletter group, where he co-founded the award-winning Bloomberg Economic Brief. Earlier in his career, he was a director at Moody's Analytics covering the U.S. and global economies for the Dismal Scientist website. He also served as chief economist at Merk Investments L.L.C. and chief U.S. economist at IDEAglobal.

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