United States: A flashback to the 1970s

CHART OF THE WEEK

Weekly unemployment claims have fallen to lows not seen since 1973. For the week beginning
19 March, just 215,000 people claimed unemployment benefits. However, since 1973, the size of the active labour force has risen from 89 million to over 160 million. These 215,000 unemployment claims therefore represent a far smaller proportion of the active workforce than they did back in 1973.

 

OUR ANALYSIS

The US employment market is still remarkably solid. Job creations remain high (2.2 million jobs created in the past twelve months), and the latest unemployment benefit claims number suggests that momentum remained strong in March.

Furthermore, the JOLTS survey indicates a very low ‘layoffs and discharges’ rate, in line with the low level of benefit claims, and a ‘quits’ rate at highs matching those of 2005–2006.

Although the disappointing consumption figures for the start of 2018 could weigh on first-quarter growth levels, the solid job creation numbers confirm that the US economy is in good health.

 

The opinion expressed above is dated 30 March 2018 and is liable to change.

This document is not pre-contractual or contractual in nature. It is provided for information purposes. The analyses and descriptions contained in this document shall not be interpreted as being advice or recommendations on the part of Lazard Frères Gestion SAS. This document does not constitute an offer or invitation to purchase or sell, nor an encouragement to invest. This document is the intellectual property of Lazard Frères Gestion SAS.


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Julien-Pierre Nouen

Directeur des études économiques et de la gestion diversifiée