Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail
Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail

Jobless Claims

What it is:

Jobless claims refer to the unemployment benefits claims filed by unemployed individuals each week.

How it works (Example):

People who have lost their jobs or have been unemployed for some length of time are entitled to relief payments from the federal government. The U.S. Department of Labor records the number of jobless claims filed each week.

Jobless claims fall under two categories: initial and continuing. Initial jobless claims refer to those individuals filing for unemployment benefits for the first time. Continuing jobless claims refer to those who have already filed for two or more consecutive weeks. Changes in the number of jobless claims from week-to-week tend to reflect changes in the overall unemployment rate. For example, an increase in the unemployment rate directly reflects an increase in the number of jobless claims.

Why it Matters:

Analysts and policy makers review the volume of jobless claims from week-to-week as well as the ratio of initial claims-to-continuing claims to gauge the direction of the unemployment rate and the overall health of the economy.