EmailThe initial claims level dropped from an upwardly revised 388,000 (from 386,000) for the week ending July 14 to 353,000 for the week ending July 21. The Briefing.com consensus expected the initial claims level to fall to 381,000. Like two weeks ago, when claims also fell into the 350,000s, the move was the result of poor seasonal adjustment factors surrounding the auto sector and not a change in labor demand. In July, motor vehicle manufacturers normally shut down for model year retooling.
With stronger-than-expected sales growth, many manufacturers have opted not to shut down this year. This caused the Department of Labor to overestimate the seasonal portion of layoffs. It normally takes a few weeks before the seasonal adjustment problems work through the data. Thus, it would not be unusual to see more volatility in the initial claims numbers through the end of the month. The continuing claims level decreased from an upwardly revised 3.317 mln (from 3.300 mln) for the week ending July 7 to 3.287 mln for the week ending July 14. The consensus pegged the continuing claims number at 3.300 mln.
