–Initial Claims Level Fall by 810,000/4.427 Mln
–Continuing Claims Still Have More Room to Rise
–New Home Sales -15.4%/627,000; Social Distancing To Cut Deeper in April
–Markit Data Show Factory, Services Conditions Deteriorated Further
By Kevin Kastner
WASHINGTON (MaceNews) – The growth rate of initial claims slowed modestly in the April 18 employment survey week but remain elevated, lifting the total number of new claims filed over the last five weeks to 26.5 million.
The level of initial claims fell by 810,000 to 4.427 million in the current week, as the backlog of filings continued to be worked down. The claims level was only 282,000 in the March 14 employment survey week.
The consensus forecast was for a 4.00 million level following a downward revised 5.237 million level in the previous week. Unadjusted claims fell by 697,173 million in the current week.
The unadjusted state data showed initial claims fell in most states, especially California and New York. However, there was a large surge in claims in Florida even as some public areas reopened.
Continuing claims, the total number of people currently receiving benefits, rose by 4.064 million to a record 15.976 million in the April 11 week. The insured unemployment rate jumped to 11.0% from 8.2% in the previous week.
The level of continuing claims should rise until it approaches the total number of initial claims filed since the start of the shutdown, based on the assumption that most filers will not return to work until it ends.
Also released Thursday, new home sales declined sharply in March to a 627,000 annual rate from 741,000 in February, slightly below the 632,000 rate expected. There were declines in the all four geographic regions.
Even as U.S. consumers have partially shifted to virtual shopping, dining and entertainment during social distancing, the temporary halt to home showings and the complexity of the home buying process will depress sales going forward.
Home supply rose by 2.8% but was down 1.2% from the same month a year ago. The month supply surged to 6.4 months at the current sales rate from 5.2 months in February and 5.8 months a year ago. However, construction data suggest that new home supply will slip in the coming months.
The median sales price fell by 2.6% from February but were up 3.5% a year ago. As with existing home sales, expected tight supply should continue to support prices even with falling demand. Home building data released last week indicated a slowdown in construction and a reduction in builders’ sentiment, suggesting fewer new homes for sale in the coming months.
In other data released Thursday, Markit reported that both manufacturing and nonmanufacturing conditions deteriorated further in early April. The flash estimate for manufacturing fell to 36.9 from the 48.5 reading in March, hitting the lowest point since 2009. The early estimate for nonmanufacturing fell to a record low reading of 27.0 from 39.8 in March. Both were below expectations.
The composite index, a combination of the manufacturing and services readings, fell to a record low 27.4 from 40.9 in the previous month.
Regional conditions data for April will be published over the next week ahead of the early-May releases of the national ISM data.
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Contact this reporter: kevin@macenews.com