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Takeaway: The rate of improvement in the labor market slowed notably this past week, but we're not going to get excited by one week of data.

This past week, rolling Non Seasonally Adjusted (NSA) initial claims were 8.8% lower than the prior year. This marks a decelerating rate of improvement vs the prior week, when rolling NSA claims were better by 10.6%. On a single week basis, NSA claims were 0.8% lower than the previous year, a sharp deceleration vs the prior nine prints of: -9.9%, -13.3%, -9.4%, -9.2%, -7.7%, -11.7%, -9.4%, -7.6% and -8.0%. 

Initial Claims: Good, But Less Good - roll

A possible explanation is that we're eclipsing the auto plant closings, which create significant NSA volatility. Recall that this year, due to heavy demand, there were far fewer auto plant shutdowns than in the corresponding periods last year. That said, the auto dynamic is a two-week phenomenon, so it wouldn't explain the deviation from the trend we've been seeing the last nine weeks.

Bear in mind that in less than six weeks, we'll shift out of the seasonally-adjusted data headwind period into the data tailwind period, which will last six months from September through February, 2014.

The Data

Prior to revision, initial jobless claims rose 9,000 to 343,000 from 334,000 week-over-week, as the prior week's number was revised up by 2,000 to 336,000.

The headline (unrevised) number shows claims were higher by 7,000 week-over-week. Meanwhile, the 4-week rolling average of seasonally-adjusted claims fell -1.25K week-over-week to 345.25K.

The 4-week rolling average of NSA claims, which we consider a more accurate representation of the underlying labor market trend, was -8.8% lower year-over-year, which is a sequential deterioration versus the previous week's year-over-year change of -10.6%

Initial Claims: Good, But Less Good - roll2