Initial jobless claims fell to 404,000 for the week ended 1/15/11. It was a nice drop, a larger drop than the consensus 425,000 which is good news for the economy, yet we have a long way to go to make a noticeable dent in the ranks of unemployed. As those who simply gave up looking for work re-enter the labor market it’s highly plausible that unemployment will stabilize or increase somewhat.
While the overall jobless claims seem to be continuing on a downward trend, it’s better to look at a moving average of jobless claims rather than week to week. The four week moving average fell 4,000 to 411,750. More positive news.
The direction of claims over the next several weeks as we move farther from the holiday season will be interesting to watch… yet all in all, we seem to be moving in the right direction.
