Continuing Jobless Claims reading reflects the number of Americans who previously filed for an initial claim and continue to receive unemployment benefits due to not finding jobs. This indicator with the Initial Jobless Claims is published weekly by the U.S. Department of Labor.
In other words, this indicator indicates the number of people who continue to receive unemployment benefits weekly.
A worker who receives unemployment benefits has to refile a jobless claim each week of unemployment. And the number of American workers who receive weekly is calculated.
Who Can Continuing Jobless Claims?
The governmental insurance system funds Unemployment benefits. It can not pay forever. To motivate workers to seek employment, they receive benefits for a limited period, which are smaller than the average wages across America.
This indicator is not about the unemployment rate because it does not consider employment conditions. It covers only those who have been or are covered by unemployment insurance.
In short, a person continues claiming if he:
- is covered by unemployment insurance and currently receives benefits;
- lost his job for at least a week after filing the initial claim;
- actively seeks jobs;
- is not fired for causes; and
- has lost his job due to economic reasons.
Someone cannot continue claiming jobless benefits if he:
- found a job;
- exhausted the benefits;
- is not actively looking for work;
- does not accept new work;
- left his job for personal reasons; and
- his employer fired him.
The Importance of Continuing Jobless Claims
The indicator is published weekly which is more frequently. Thus, investors do not expect it to have a great impact on the market or currency pairs.
This indicator is not a good way to measure the job market as well. Fluctuation happens in the job market. And we cannot say that the whole market has a good positive or negative correlation with Continuing Jobless Claims.
Thus, it is not a leading indicator.
However, it can be a good indicator during the recession and recovery phases of the business cycle because employment data is more important in these periods. The Continuing Claims reading tells about the job market more frequently which is helpful in the recession and recovery phases.
In general, a sharp increase than expected may hurt the U.S. market and USD quotes. A huge drop than expected may have a positive impact on the United States economy or the United States Dollar.
The Continuing Claims data reflects the number of Americans who continue to claim unemployment benefits every week. It is not a powerful or leading indicator.
However, during the recession and recovery phases of the business cycle, it shows more frequently what happens in the job market. Thus, it is more important in those times.