Jobless claims came in at 377,000, after being revised up AGAIN for the previous week from an already-high 383,000 to 389.000. This matches the trend of downward of revisions to employment growth that we have seen in recent months and illustrates that labor market conditions remain stable, but at a very weak level of activity.
Some of the weakness we have seen in recent months could be attributed to a mild winter and earlier than usual spring hiring. What is disturbing is that most of those distortions have passed and what we are left with still doesn’t look good.
Bottom Line: Labor market conditions have deteriorated since the start of the year. Look for Federal Reserve Chairman Ben Bernanke to highlight this along with the ongoing instability in Europe as conditions under which the Fed would consider easing further.