Unemployment Claims Reflect Sluggish Recovery

Market participants who want to use this week’s initial unemployment insurance claims report to gain some insight in the the labor market may end up disappointed. The report, released on Thursday morning, by the U.S. Department of Labor, indicates more of the same give-and-take that has characterized most unemployment data for the last year.

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Initial unemployment claims for the week ended February 23 declined about 6 percent month over month to 344,000. The four-week moving average declined about 1.9 percent month over month to 355,000. This is a 3.2 percent improvement over the moving average for same week in 2012.

Ostensibly this is a slight improvement, but it’s hard to determine whether new hiring or the expiration of benefits caused this shift. Several states reported fewer layoffs in construction and manufacturing, which could be a reflection of healthy housing and PMI data that was released earlier in the month, but the slight drop is not enough to convince anyone that the headline rate will decline this month…