First-time jobless claims decreased by 15,000 to 385,000 for the week ending July 31 while continuing claims for the week ending July 24 stood at 2.9 million, according to government data released Thursday.
The top-line figure is close to the 13-week moving average of 404,100.
The top-line figure is close to the 13-week moving average of 404,100 and the four-week moving average of 394,000.
The total number of people claiming some form of unemployment insurance declined by 181,251, to 12.975 million. This compares to the 31.98 million who claimed unemployment insurance a year ago as the economic shock of the pandemic had set in.
It is important to note that the jobless claims figures for the week ending July 31 will not affect the employment data for July when the jobs report is released on Friday.
The Fed’s employment goal
As the Federal Reserve contemplates starting to unwind its monthly asset purchases later this year or early next year, it has signaled that it will need to observe “substantial further progress” in its policy objectives of maximum employment and price stability.
While the economy is now expanding and is above its pre-pandemic level of overall activity, on the employment side of the equation, that is clearly not the case. With the economy roughly 6.7 million jobs short of where it was before the pandemic and jobless claims at elevated levels near 400,000, the case for hiking rates sooner rather than later remains inelegant and weak.
We continue to make the case that it will be late next year before the economy is anywhere near full employment, so it is paramount that fiscal and monetary accommodation remain in place until that policy goal is achieved.
For more information on how the coronavirus pandemic is affecting midsize businesses, please visit the RSM Coronavirus Resource Center.
