Weekly Jobless Claims Drop, Philly Fed Manufacturing Activity Declines

Highlights

• Initial jobless claims drop by 22,000.
• Manufacturing activity declines, impacting employment.
• Philly Fed survey reveals negative employment trends and subdued growth expectations.

Overview

Weekly Initial Jobless Claims Drop to 242,000, Indicating a Decrease of 22,000

For the week ending May 13, there were 242,000 seasonally adjusted initial claims, which marked a decrease of 22,000 compared to the unrevised level of 264,000 in the previous week. The 4-week moving average stood at 244,250, showing a decrease of 1,000 from the unrevised average of 245,250 in the previous week.

The seasonally adjusted insured unemployment rate remained unchanged at 1.2 percent for the week ending May 6, the same as the unrevised rate in the previous week. During the week ending May 6, there were 1,799,000 seasonally adjusted insured unemployment cases, indicating a decrease of 8,000 from the revised level in the previous week. The previous week’s level was revised down by 6,000 from 1,813,000 to 1,807,000.

Furthermore, the 4-week moving average for seasonally adjusted insured unemployment was 1,812,500, showing a decrease of 15,500 from the revised average in the previous week. The previous week’s average was revised down by 1,500 from 1,829,500 to 1,828,000.

Philly Fed Report: Manufacturing Activity Declines, Employment Drops

According to the May Manufacturing Business Outlook Survey, the overall manufacturing activity in the region continued to decline. Although there was some improvement in certain indicators compared to the previous month, they still remained negative. Additionally, the surveyed firms reported a decrease in employment. The price indexes remained below their long-run averages, with the prices received index showing a further decline. The survey’s future indexes reflected subdued expectations for growth in the next six months.

Current Indicators: The diffusion index for current general activity increased from -31.3 last month to -10.4 this month, marking its ninth consecutive negative reading (refer to Chart). Around 35 percent of the firms reported a decrease, unchanged from the previous month, while 25 percent reported an increase (up from 3 percent). Approximately 41 percent of the firms reported no change in current activity, down from 59 percent last month. The indexes for new orders and shipments both improved for the second consecutive month but remained negative. The index for current new orders rose by 14 points to -8.9, and the current shipments index increased by 3 points to -4.7.

Employment: The surveyed firms reported an overall decline in employment. The employment index dropped from -0.2 to -8.6, marking its third consecutive negative reading. Over 15 percent of the firms reported a decrease in employment, while 7 percent reported an increase. The majority of firms (76 percent) reported no change. The average workweek index remained largely unchanged at 7.7.