The numbers: New U.S. jobless claims matched a 54-year low of 166,000 in early April — the second lowest reading in history— during a period of remarkably strong hiring and the lowest layoffs on record.
New filings for unemployment benefits declined by 5,000 from a revised 171,000 in the prior week, the Labor Department said Thursday.
The only other time jobless claims have been that low was in November 1968. The government began tracking unemployment filings in 1967.
Economists polled by the Wall Street Journal forecast initial jobless claims to total a seasonally adjusted 200,000 in the seven days ended April 2, but the estimate did not factor in government revisions going back five years.
The regular revisions showed jobless claims to be even lower this year than previously reported. The 171,000 reading from last week, for example, was revised down from an original 202,000.
Starting next week, the government will revert back to its pre-pandemic method of calculating jobless claims. It will also use a hybrid approach that incorporates its old approach before the pandemic with adjustments made during the crisis to try to make the data more accurate.
Big picture: The U.S. jobs market is hopping — literally. Millions of Americans are quitting one job and hopping to another in search of higher pay, better benefits or more flexibility such as working from home.
It’s great news for workers: wages are rising at the fastest pace in decades. Not so much for businesses. Their costs are going up and they still can’t find enough labor to produce enough goods and services to meet high demand.
A strong labor market is a buffer against recession, however.
Key details: Raw, or unadjusted, jobless claims fell in more than half the states.
The only states to post a sizable increase in new unemployment-benefits claims were California, Ohio and Pennsylvania.
The number of people already collecting unemployment benefits, meanwhile, rose by 17,000 to 1.52 million in the week ended March 26.
These so-called continuing claims, which are reported with a one-week lag, have fallen below pre-crisis levels and are extremely low.
Looking ahead: “Demand for labor is strong and there are no reasons to believe that this will change any time soon,” said money market economist Thomas Simons at Jefferies LLC.
“We expect initial claims to remain well below 200,000 as employers, who continue to struggle to attract and retain workers, will keep layoffs to a minimum,” said lead U.S. economist Nancy Vanden Houten of Oxford Economics.
Market reaction: The Dow Jones Industrial Average DJIA, -0.50% and S&P 500 SPX, -0.46% fell in Thursday trades.