Fewer Unemployment Claims Filed

  • Fewer workers claimed unemployment insurance in the week ending May 3, an early indicator that the job market continues to improve surely even if slowly. Initial claims for unemployment insurance[1] were at 319,000, fewer by 26,000 from the previous week’s level.

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  • Claims are now down to their normal levels. If this trend continues, NAR forecasts about 2 to 2.5 million net new job creations this year and the next year.
  • For the week ending April 26, the largest decrease in claims were in Michigan (-6,642), New Jersey (-2,269), Pennsylvania (-1,704), Maryland (-1,670), and California (-1,237).  The largest increases in claims New York (+23,523), Massachusetts (+3,983), Rhode Island (+1,080), Oregon (+959), and Delaware (+956).

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  • Still, what matters to housing is the number of people with jobs as depicted in the graph above. Although the unemployment rate has been dropping with the April rate at 6.3 percent, the share of the population that is employed has barely nudged at 58 percent from its peak of about 63 percent. In a testimony before Congress yesterday, Federal Reserve Board Chairman Janet Yellen reported that labor market conditions are “far from satisfactory” and that “housing may be stalling and bears watching.”  Existing home sales are hovering at about 4.6 million in 2014, down from last year’s average of about 5 million. 

[1] Claims filed under the regular state programs, seasonally adjusted