It's Thursday ¯\_(ツ)_/¯

_Claims and planned layoffs

Labor costs and productivity

The state of the economy is ………_So, he have a spike in initial unemployment claims, though continuing claims, which are actually from a week earlier, fell.

Planned layoffs remain low, though they are up a bit, and productivity rose slightly, but wages did not keep up with inflation.

Meanwhile, I get serious 2008 vibes from the fall in factory construction jobs as well as the increasing exodus of realtors from the profession.

The number of Americans filing claims for unemployment benefits increased more than expected last week, touching their highest level in four months, but the underlying trend remained consistent with a stable labor market.

Economists shrugged off the rise in weekly jobless claims reported by the Labor Department on Thursday as volatility related to ​last Monday's Memorial Day holiday. Claims tend to rise around public holidays. They said there were no signs yet the Middle East conflict was having a noticeable impact on the labor market, ‌though uncertainty was growing.

………

Initial claims for state unemployment benefits rose 13,000 to a seasonally adjusted 225,000 for the week ended May 30, the ​highest level since the first week of February. Economists polled by Reuters had forecast 213,000 claims for the latest week. The four-week moving average of claims, which irons out week-to-week volatility, increased only 6,500 to 214,750.

………

Layoffs remain low by historical standards, despite high-profile job cuts by technology firms related to the adoption of artificial intelligence. U.S.-based employers announced 97,006 ​job cuts in May, about 39% of them in the technology sector, a separate report from global outplacement firm Challenger, Gray and Christmas showed on Thursday. That was up 16% from April.

………

Still, planned job cuts rose only 3% compared to the same period last year. Though employers have not responded with mass layoffs to rising shortages and inflation stemming from the U.S.-Israeli war with Iran, now in its fourth month, economists said that could change, the longer the conflict drags on. The Labor Department's Job Openings and Labor Turnover Survey, or JOLTS report, on Tuesday showed hiring decreased and layoffs fell in April, suggesting the increase in payrolls that month was due to lower layoffs. A stable labor market allows the Federal Reserve to focus on inflation. Financial markets expect the U.S. central bank to keep its benchmark overnight interest rate in the 3.50%-3.75% range into 2027.

U.S. stocks opened lower. The dollar slipped against a basket of currencies. U.S. Treasury yields fell. A third report from the ​Labor Department's Bureau of Labor Statistics showed worker productivity growth ​slowed faster than initially thought in the first ⁠quarter, but the underlying trend remained strong and a boost is expected from businesses adopting artificial intelligence for many roles. Nonfarm productivity, which measures hourly output per worker, increased at a downwardly revised 0.3% annualized rate last quarter. That was the slowest since the first quarter of 2025. Productivity was previously estimated to have risen at a 0.8% pace last quarter. Economists ​had expected productivity growth would be revised down to a 0.5% pace.

As to factory construction:

Yesterday, the Commerce Department released data on construction in April. It showed that factory construction is continuing to fall. In nominal terms, it dropped another 1.2 percent in April from its March level. Adjusting for inflation, the decline would be roughly 1.3 percent.

Factory construction has been on a downward path since the third quarter of 2024. It is now down by close to 27 percent from its recent peak.

As to realtors:

The slowest housing market in decades is stretching into its fourth year, and even real-estate agents who made it this far are reaching a breaking point. Most of them are independent contractors and get paid when a deal closes. With fewer sales to go around and homes taking longer to sell, more agents are ditching the industry or finding second jobs.

………

The downturn is also hitting mortgage-loan officers and the many other industries reliant on home sales, from appraisers and photographers to appliance manufacturers.

………

The National Association of Realtors had 1.4 million members as of April, down from a peak of 1.6 million in October 2022.

This seems to me to be a Wile E. Coyote moment economy.