In each Economic Update, the Research staff analyzes recently released economic indicators and addresses what these indicators mean for REALTORS® and their clients. Today’s update discusses unemployment insurance claims.
- Initial claims for unemployment insurance filed in the week ending June 1 dropped to 346,000, a decrease of 11,000 claims from the previous week’s upwardly revised level. This brings the May average, as well as the year-to-date average, to the pre-recession level of about 350,000 claims. A lower level of initial claims for unemployment insurance means fewer layoffs in existing jobs and greater job security.
- In a related report released yesterday, ADP (which is a payroll processing company) reported an increase of 135,000 payroll jobs in May, which is better than April’s 113,000 jobs.
- The May unemployment figure will be released tomorrow. Although initial claims for unemployment insurance data is not used in the computation of the official figures, the historical data shows that claims data generally tracks with the unemployment rate. Similarly, the official jobs generated data and ADP payroll data also generally move in the same direction.
- Based on the above data and GDP growth, which still remains sluggish, the official job creation to be reported on Friday by the Bureau of Labor Statistics looks to be 100,000 to 150,000. Such a job gain is a bit below normal considering population growth and the stream of college graduates entering the labor force.