Initial claims for unemployment insurance filed under the regular state programs during the week ending July 19 fell 284,000—the lowest level since 2006. The 4-week moving average also dipped to its lowest level since 2007 to 302,000 claims. Initial claims for unemployment insurance are filed by workers starting a period of unemployment. Fewer initial claims mean fewer layoffs and greater job stability. Most analysts consider a level of 300,000 as an indicator of normal economic activity.
Initial claims data by state lag a week compared to the national level data. For the week ending July 12, initial claims tallied at 303,000. The largest increases in jobless claims were in NY, CA, GA, TX, IN, and PA. Meanwhile, the largest decreases in jobless claims were in MI, NJ, KY, and OH.
Although the unemployment rate has been falling towards 6 percent, the pace of job creation needs to gain more steam. The drop in unemployment is in part due to a declining labor force participation, while the employment rate has barely improved. NAR expects 2 to 2.5 million net new jobs this year and the next based partly on the trends in the unemployment claims.