Unemployment Claims Edge Upward, But Remain Low

What Thursday’s Economic Reports Tell Us

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New unemployment claims rose to the highest level for any week since January, and household net worth dropped for the first time since the initial crush of COVID-19, reports showed Thursday.

Here’s a quick look at the most significant economic indicators of the day and what they tell us.

Initial Jobless Claims

  • Last week 229,000 people filed new claims for unemployment benefits, 27,000 more than in the previous week and the most since January, according to the Department of Labor. Economists had expected 195,000.
  • While weekly claims are still quite low relatively speaking—in the range seen before the pandemic—economists cautioned that a recent upward drift could be a sign of increasing layoffs. “The labor market remains in solid shape in the spring quarter but the rise in initial claims since early April is a cool breeze blowing at the hot labor market,” PNC Senior Economic Advisor Stuart Hoffman said in a commentary.

Household Net Worth

  • The net worth of households and nonprofit organizations in the U.S. fell very slightly in the first quarter, dropping to $149.3 trillion, and marking the first decline since the pandemic struck, the Federal Reserve reported. 
  • Net worth measures assets minus liabilities, and the 0.4% dip stemmed from a decline in financial assets and an increase in household debt.
  • Stocks have taken a beating this year, and a $3 trillion decline in stock assets outweighed a $1.7 trillion jump in real estate values spurred along by soaring home prices. The increase in household debt was driven by households boosting their credit card spending and taking on more mortgage debt to pay for those increasingly expensive homes, according to economists at Moody’s Analytics.

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  1. Department of Labor. “News Release.”

  2. MarketWatch. “US Economic Calendar.”

  3. Federal Reserve. “Z.1 Financial Accounts of the United States.” Page 3.

  4. FRED Economic Data. “Households and Nonprofit Organizations; Net Worth, Level."

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