Conditions in the labor market remain relatively calm. Although initial claims for unemployment last week exceeded expectations (+360K vs. +340K), the difference was very likely due to seasonal adjustment issues related to July autoworker layoffs. Abstracting from this, claims are low, especially when compared to the size of the workforce.
The trend in claims is still down. On an unadjusted basis, claims were down 13% compared to year-ago levels.
Compared to the size of the workforce, weekly claims have rarely been lower.
The number of people receiving unemployment compensation today is down 23% from year-ago levels. That translates into 1.32 million fewer people on the dole in the past year. This continues to be one of the more significant changes on the margin in today's economy, and it is a positive because it means that a substantial number of people have an increased incentive to find and accept a new job.
The main problem continues to be a relative lack of new job opportunities. The fundamentals are in place for a stronger expansion (businesses have done lots of cost-cutting and trimming), but for new hiring to improve, we are going to need policy changes that reduce the costs and risks of hiring new workers (e.g., a permanent delay or repeal of Obamacare). There's a reasonable and growing chance that this will happen, as I summarized in a post a few days ago.