Key Takeaways:

  • The latest weekly claim is 293,000, with the downward pattern beginning to level off;
  •  Totals remain considerably above the 218,000 weekly average in 2019;
  • Every state has higher claims than it did in January 2020, ranging from just 16% higher in South Carolina to an eye-popping 294% higher in Virginia;
  • Claims in California, Texas and Florida are each more than 150% higher than in January 2020.

By Manuel Gutierrez, Consulting Economist to NKBA

Given the difficulty that most businesses are currently having finding workers to fill vacant positions, it should come as no surprise that unemployment claims are experiencing a steady downtrend.

Figure 1 illustrates that trend, with the latest number of weekly unemployment claims dropping to 293,000.

The latest number of weekly unemployment claims stands at 293,000, the lowest since March 2020.

This is the lowest number of claims since the first week of March 2020, just prior to the onset of COVID-19 and government-imposed restrictions on various business operations and social activities.

However, it hasn’t been a straight-line fall, with numbers fluctuating week-to-week. For this reason, the Department of Labor also looks at a running four-week average to smooth out such fluctuations. The solid blue line in Figure 1, which is a statistic calculated to reveal the underlying trend in the data, reflects a smoothened view of the actual information.

This trend appears to be leveling off recently, as the number of weekly claims approaches the 218,000 average filed throughout 2019.

Geographically, unemployment claims generally follow the national pattern. There are large differences, however, in the magnitude of the improvement state-by-state.

Figure 2 displays changes by state since January 2020.

For each state, the latest number is compared with the state’s claims for the first week of last year. That was the peak of the economic boom, when U.S. unemployment had fallen to 3.5% and employment was rising rapidly.

For the week ended Oct. 9, all states reported higher unemployment claims than they did in January 2020, but the differences by state can be dramatic.

South Carolina, the top bar in the left panel of Figure 2, leads with the best improvement among all states. Claims today are just 16% higher there than the number filed in January 2020. Other states with strong performances are Idaho, with 28% more claims today, and Connecticut and North Dakota, each with 30% more claims.

This is in sharp contrast to the percentages on the right side of Figure 2, where unemployment claims remain a concern. There are seven states where unemployment claims are more than 150% higher now than they were at the low point. They are led by Virginia, which has a whopping 294% more claims than in January 2020. Claims in populous states such as California, Texas and Florida also exceed 150% higher claims, with Tennessee, New Mexico and Louisiana rounding out those seven states.

Charts: