by Calculated Risk on 7/03/2020 12:25:00 PM

A few comments:

On a monthly basis, most analysts focus on initial unemployment claims for the BLS reference week of the employment report.  For July, the BLS reference week will be July 12th through the 18th, and initial claims for that week will be released on Thursday, July 23rd.

Note that a few states have not released Pandemic Unemployment Assistance (PUA) claims yet. This includes Georgia, New Hampshire and a few other areas - so the number of PUA claims is too low. However, there may also be processing delays that are impacting the numbers.

Continued claims increased slightly last week to 19,290,000 (SA) from 19,231,000 (SA) the previous week. However, continued claims are down 5.6 million from the peak, suggesting a large number of people have returned to their jobs (as the employment report showed).

The following graph shows regular initial unemployment claims (blue) and PUA claims (red) since early February.

Click on graph for larger image.

This was the 15th consecutive week with extraordinarily high initial claims.

It is possible that we are starting to see some layoffs associated with the end of some early Payroll Protection Plan (PPP) participants.

We should start seeing layoffs associated with the rising COVID cases and hospitalization in some states (like Arizona, Florida and Texas).  With bar and restaurant closings in some areas, we will probably see more initial claims in those states in the coming week, and that will show up in the report the following week.

Note that these states don't have to lockdown to see a decline in economic activity. As Merrill Lynch economists noted last month: "Most of the slowdown occurred due to voluntary social distancing rather than lockdown policies."

Initial unemployment claims, and continued claims (and PUA claims) are important high frequency indicators to follow right now.