Analyst: Holiday Fluctuation Affects Unemployment Benefits Data, Revealing Differences in Labor Market Trends

On December 26, Nancy Lazar and Dave Wigglesworth, analysts at financial firm Piper Sandler, said that the holiday season will bring fluctuation to the seasonal adjustments used in the unemployment claims data. However, the discrepancy between initial and continuing claims reflects a deeper trend: initial claims have remained relatively stable, falling to 219,000 in the latest week, while continuing claims for those who remain unemployed have climbed to their highest level since late 2021. This suggests that everything is fine for the majority of those who have jobs – there has been no surge in layoffs – but once unemployed, it is difficult to find a new job, in line with the fact that the labor market is cooling but has not yet collapsed.