Daily Economic Update: Jobless Claims

Each day the Research staff takes a look at recently released economic indicators, addressing what these indicators mean for REALTORS® and their clients. Today’s update highlights jobless claims.

• The past week suggested some improvement in the labor market. New jobless claims decreased by a significant 24,000 to 398,000. This was the first reading below 400,000 since April. Economists generally estimate that once new claims fall below 400,000, the economy is creating more jobs than losing.
• The four-week average also dropped by a sharp 8,500 to 413,750. While still above the 400,000 level, this is almost a 15,000 improvement from the previous month. Continuing claims have also been falling, with 17,000 fewer claims in the middle of July, with total continuing jobless claims currently at 3.703 million.
• The largest increases in initial claims were in California, Georgia, North Carolina, South Carolina, and Florida while the largest decreases were in New York, Minnesota, Michigan, Ohio, and Pennsylvania. Assuming that jobless claims continue to trend down, NAR expects about 1.5 to 2 million net new jobs in the next 12 months. If claims remain stubbornly above 400,000, only 1 to 1.5 million jobs will be created on net.