Mind the holiday distortion. I’ll say it again: Mind the holiday distortion.

I’m not necessarily suggesting Thursday’s enormous plunge in initial US jobless claims was solely down to a Thanksgiving anomaly, but whenever you see a multi-sigma surprise in a given macro series, you should generally dismiss it unless and until it’s borne out by a successive update on the same series. (That’s not a big ask with initial claims given that we get an update every week.)

The initial filers series for the week to November 29 showed a 27,000 decline to just 191,000. That’s the lowest since September of 2022 and notwithstanding the fact that claims were subdued (i.e., quite low) already, I guarantee you that’s a fluke.

Obviously, no economist who ventured a guess was anywhere near the headline. Consensus was 220,000. At just 214,750, the four-week average is the lowest in 11 months.

To reiterate, I’m not saying there’s no truth at all to the generic explanation — the boilerplate copy says the US labor market is “low-hire, low-fire” as employers remain reluctant to let workers go, even as high-profile layoff announcements are a fixture of the weekly financial news cycle.

Rather, I’m simply saying that 191,000 on the initial claims headline isn’t reflective of the underlying reality in the jobs market, which is decelerating on every other metric. (Thursday’s Challenger report showed the third-most November job cut announcements since Lehman and the fewest YTD hiring plans since 2010.)

Thursday’s continuing claims print for the week to November 22 was 1.939 million, below estimates but still near the highest since late-2021.

Again: Write the initial filers headline off, folks. It’s meaningless until proven otherwise.