US: Initial Claims remain high, but continuing flat – Wells Fargo

Data released on Thursday showed initial jobless claims reached almost three million last week.  Analysts at Wells Fargo, note that despite the high number of initial claims, continuing claims “just barely rose”, a positive sign. They point out the May nonfarm payroll report should be better than April.

Key Quotes: 

“Initial jobless claims declined for the sixth straight week from their peak of 6.8 million at the end of March, but the rate of decay appears to be stalling. The three million claims filed last week brings the eight-week total to 36.5 million.”

“The persistence of seven-digit initial claims figures is discouraging, but there was a major bright spot—continuing claims, which lag a week, were essentially flat, at 22.8 million.”

“10 million initial claims have been filed since the April nonfarm survey, but evidently hiring has begun to pick back up. The net loss in May employment should therefore be much lower.”