Today's initial claims report shows unemployment rate holding steady tomorrow--and that's about as good as we can expect right now

09/01/2011 12:52 pm EST

Focus: STOCKS

Jim Jubak

Founder and Editor, JubakPicks.com

A decent set up for tomorrow’s August jobs and unemployment rate report from today’s initial claims for unemployment report. Initial claims for unemployment fell to 409,000 for the week ended on August 27 from 421,000 the week before.

Although this isn’t as big a drop as economists were expecting—Briefing.com’s survey put the consensus at a drop to 407,000 for the week—it’s probably enough to indicate that the unemployment rate will remain steady in tomorrow’s report.

That’s good news since a long holiday weekend following days of higher share prices is likely to make tomorrow a day for profit taking—even without any bad news.

This week’s numbers weren't inflated by the Verizon strike that added to the initial claims level for the weeks that ended on August 13 and 20. And they represent a return to what has been the trend rate of slightly above 400,000 but below 410,000.

That level—400,000 to 410,000—makes it likely that tomorrow’s jobs report will show the economy adding somewhere around 100,000 jobs in August. That’s not enough to reduce the unemployment rate but should be enough to keep it stable.

And with everyone afraid that the economy is about to drop off a cliff, a stable unemployment rate qualifies as decent news.

 

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