US DATA: Continuing Claims Pick Up As Federal Jobless Claims Jump

The latest weekly jobless claims data - and the first official Department of Labor release since the federal government shutdown started on Oct 1 - showed a continuation of the "low-firing" labor market trend in the initial column, though a slightly concerning "low-hiring" dynamic evident in continuing claims. However, it should also be noted that the government shutdown  - and potentially federal cuts - boosted federal government worker claims substantially through early November.

• The 220k (SA) initial claims in the week of Nov 15 were the joint-lowest (seen also in the Oct 11 and Oct 25 weeks) since Sep 20, and a fall from 228k prior. This was also below the 227k consensus and suggests relative stability in this November payrolls reference week. The 224k 4-week average was the lowest in 5 weeks and this metric has been in a tight range (224-227k) since the end of September.
• More concerning were continuing claims which jumped 28k in the Nov 1 week to 1,974k (1,950k expected). That was the biggest one-week rise in 15 weeks and represents the highest figure since November 2021. We always take such moves with a bit of caution as continuing claims have a tendency to be revised down in future, but obviously we will be watching to see if there is confirmation of a shift out of the recent range.
• As the chart below shows, a jump in claims from federal workers - they jumped 5,719 in the Nov 8 week, which was a decrease from 7,482k the prior week (data from mid-Sept to late Oct was not available). And there were 38,867 continued claims filed by ex-federal workers in the Nov 1 week.
• These are not seasonally adjusted series but in any case they were easily the highest readings since 2018-19, again potentially reflecting federal layoffs - and we did see a notable tickup in continuing claims in the DC area as well for the latest week.
• The back-filling of claims data didn't show much deviation from analysts' estimates based on state-by-state data that were still available through the pandemic.