New Unemployment Weekly Claims Lowest Since 1969

Initial claims for unemployment insurance across the U.S. were 187,000 for the week ending March 19, 2022, on a seasonally adjusted basis. This was down by 28,000 (13.0%) from the revised figure for the prior week. The four-week moving average for initial claims was 211,750, down by 11,500 (5.2%) from the revised figure for the prior week.

The figure of 187,000 new weekly claims was the lowest since 182,000 was recorded on Sept. 6, 1969. It also represented the seventh week-to-week decline in the past nine weeks. Additionally, it was 11.0% below the estimate of 210,000 per economists polled by Bloomberg.

Recouping Pandemic Job Losses

The U.S. economy appears to be on track to recoup, by the end of 2022, all 22 million jobs lost during the recession triggered by the COVID-19 pandemic, according to a research note from Mark Zandi, the chief economist at Moody's Analytics. Zandi indicated that this recovery in employment was unlikely to have been achieved before 2026 without the extraordinary stimulus measures enacted by the U.S. government.

Prioritizing Inflation Control

The unprecedented level of government stimulus has been a key factor driving inflation to its highest level since 1982. Against a background of strong job growth, the Federal Reserve Board (FRB) "needs to move aggressively to keep inflation under control," stated James Bullard, president of the Federal Reserve Bank of St. Louis, on March 22.

Bullard was the lone member of the Federal Open Market Committee (FOMC) who favored an interest rate hike of 50 basis points (bp) at its meeting on March 15-16, 2022. The other members voted for a 25 bp increase.

Other Fed officials are more cautious about interest rate increases, "Elevated levels of uncertainty are front-forward in my mind and have tempered my confidence that an extremely aggressive rate path is appropriate today," stated Raphael Bostic, president of the Federal Reserve Bank of Atlanta, in a speech on March 21. He indicated that a tight labor market, with high labor demand and low worker supply, is a key driver of uncertainty.

Continuing Claims Decline

Unemployment insurance continuing claims fell, although compilation of this data lags new claims by one week. For the week ending March 12, 2022, the number of continuing claims, also called the number of insured unemployed persons, was 1,350,000, a decrease of 67,000 (4.7%) from the revised number for the prior week, on a seasonally adjusted basis. This was the lowest level for insured unemployment since Jan. 3, 1970, when it was 1,332,000.

The four-week moving average for continuing claims fell by 31,000 (2.1%) from the revised figure for the prior week to 1,431,500. This is the lowest level for this average since Feb. 28, 1970, when it was 1,421,000. The previous week's moving average had been revised downward by 500 (0.03%), from 1,463,000 to 1,462,500.

Putting this continuing claims figure in historical perspective, the U.S. civilian labor force has grown from 82.5 million in March 1970 to 167.0 million in February 2022, an increase of 102.4%. As a result, continuing claims as a percentage of the civilian labor force have dropped by about half since that time.

Adjusted vs. Unadjusted Data

The seasonally adjusted nationwide initial claims figure of 187,000 cited above for the week ending March 19, 2022, was derived from an unadjusted figure of 181,087. The unadjusted figure fell by 22,824 (11.2%) from 203,911 in the prior week. However, the normal seasonal factors observed at this time of year should have led to an increase of 5,080 (2.5%) from the prior week to 208,991 in the week ending March 19, 2022, all else equal. During the comparable week in 2021, there were 651,153 initial claims.

Initial Jobless Claims by State

Note that the statistics compiled by the U.S. Department of Labor also include the District of Columbia, Puerto Rico, and the Virgin Islands, in addition to the 50 states. Of these, 42 reported declines in new claims for the week ending March 19, 2022, while 11 reported increases. As indicated above, total unadjusted claims fell by 22,824 for this week.

The biggest declines in unadjusted new claims were in California (-5,341), Michigan (-4,767), Kentucky (-2,593), Illinois (-2,134), Kansas (-2,069), and Missouri (-1,087). The largest increases were in Florida (+794) and Pennsylvania (+381).

The U.S. Department of Labor cautions that the breakdown by state for the week ending March 19, 2022, contains what are called advance claims. These advance claims are reported by the state liable for paying the unemployment compensation. Data for previous weeks classify claimants by state of residence. Thus, the state-by-state figures for the week ending March 19, 2022, and the prior week are not completely comparable.

For comparable figures, the Department of Labor instead looks at the data for a week earlier, which ended March 12, 2022. The largest increases in initial claims for that week, compared to the week before that, were in Michigan (+2,068), Ohio (+1,547), California (+1,274), Missouri (+850), and Illinois (+665). The largest decreases were in New York (-16,098), Massachusetts (-1,116), New Jersey (-1,046), Washington (-992), and the District of Columbia (-945).

Highest Insured Unemployment Rates

Meanwhile, the highest insured unemployment rates for the week ending March 5, 2022, were in California (2.5%), New Jersey (2.4%), Alaska (2.3%), Illinois (2.3%), Rhode Island (2.3%), Massachusetts (2.2%), Minnesota (2.2%), New York (2.1%), Connecticut (1.9%), and Pennsylvania (1.8%).

The advance seasonally adjusted national figure for the week ending March 12, 2022, was 1.0%, unchanged from the unrevised figure for the prior week. The insured unemployment rate is the ratio of persons receiving unemployment benefits to the total number of persons in the labor force.

During the week ending March 5, 2022, extended unemployment benefits were available in New Jersey.