WASHINGTON — Initial jobless claims fell more than expected the week ending Aug. 21, dropping by 31,000 filings to 473,000 as the economic indicator posted its first decline in a month, the Labor Department reported Thursday.
Continuing claims fell to 4.456 million, the lowest level since June.
Economists expected 500,000 initial claims and 4.478 million continuing claims, according to the median estimate from Thomson Reuters.
Last week’s initial claims figure was revised upward to a nine-month high of 504,000 from 500,000.
Continuing claims for the week ending Aug. 7 were revised to 4.518 million from 4.478 million.
The four-week moving average of initial claims, a less volatile figure, increased to a nine-month high of 486,750. The four-week average for continuing claims dropped to 4,508,750.
“The rapid rise in initial jobless claims since mid-July has been giving markets a weekly jolt, so we’re glad to get the expected partial unwinding in today’s numbers,” Ellen Beeson Zentner, a senior economist with the Bank of Tokyo-Mitsubishi, said of Thursday’s jobless claims data. “That being said, [473,000] claims are simply too high to be indicative of a normally functioning labor market.”
One of the reasons economists track new unemployment claims is due to their loose inverse relationship with monthly job creation.
Initial claims of 400,000 to 425,000 a week are consistent with creation of the 115,000 to 125,000 jobs the U.S. economy needs each month to accommodate new workforce entries, according to Anthony Chan, chief economist for JPMorgan Private Wealth Management.
The median forecast in a Thomson Reuters survey of economists calls for nonfarm payrolls to lose 131,000 jobs in August when that report is released Sept. 3.
