Jobless Claims Fell to 197,000. The Number of People Already Collecting Rose 17,000.

The Labor Department reported on October 8 that seasonally adjusted initial claims for unemployment insurance were 197,000 in the week ending October 3, a decrease of 2,000 from the previous week. The previous week's figure was revised up to 199,000 from 197,000. The four-week moving average fell 2,500 to 198,000, from a revised 200,500.

The second half of the same release moved the other way. Seasonally adjusted insured unemployment — the number of people still collecting benefits, reported with a one-week lag — rose 17,000 to 1,716,000 in the week ending September 26. The prior week was revised down to 1,699,000 from 1,701,000. The insured unemployment rate was 1.1%, unchanged.

The two series measure different things

Initial claims count new filings. They are a measure of flow into unemployment insurance, which in practice means a measure of layoffs. Continued claims count the stock of people who have filed and are still collecting. That number falls when people leave the rolls, which usually means they found work.

So the two figures can diverge, and this week they did. Few new people are being laid off, and the ones already out are taking longer to leave. A rising continued-claims figure alongside flat initial claims is a statement about hiring, not about firing.

The turnover data says the same thing

The Bureau of Labor Statistics Job Openings and Labor Turnover Survey for August, released September 29, showed the same shape. Job openings were 7.1 million, a rate of 4.3%. Hires were 5.2 million, a rate of 3.3%, which the BLS described as little changed over the month and over the year. Layoffs and discharges were 1.6 million, a rate of 1.0%. Quits were 3.1 million, a rate of 1.9%, and total separations 5.1 million.

• Layoffs rate of 1.0% — employers are not shedding staff at scale
• Hires rate of 3.3% — nor are they adding them
• Quits rate of 1.9% — workers are not moving voluntarily either
• Insured unemployment rate of 1.1% — the share of covered employment drawing benefits

What the insured unemployment rate is not

The 1.1% insured unemployment rate is not the headline unemployment rate. It is the number of people collecting state unemployment benefits as a share of covered employment. It excludes anyone who has exhausted benefits, anyone who never qualified, new entrants to the labour force, and the self-employed. It is consistently and substantially lower than the household-survey unemployment rate, and the two are not interchangeable.