During the last week of September, initial claims for unemployment insurance rose 16,000 to 317,000. The latest was the highest level since the first week of last month. The Labor Department indicated that there were no special factors that distorted these readings.

The gain exceeded expectations for a lesser rise to 310,000 but left the average level of claims last month at 313,000. That was down 10,000 from August.

The trend in initial jobless insurance claims still is down from the August peak level of 325,000. That is suggestive that fewer individuals are losing their jobs, although the accompanying chart from the Labor Department's Household Employment survey indicates a rising layoff rate.

A claims level below 400,000 typically has been associated with growth in nonfarm payrolls. During the last six years there has been a (negative) 78% correlation between the level of initial claims and the m/m change in nonfarm payroll employment.

The four-week moving average of initial claims fell to 312,750 (-0.7% y/y).

Continuing claims for unemployment insurance fell 10,000 to 2,541 and reversed all of the increase during the prior week. Continuing claims have stabilized at a level off the August peak of 2,597, suggesting that the pace of rehiring may have picked up. That also is suggested by the accompanying chart which shows that the recent rise in the duration of unemployment has stabilized.

The continuing claims numbers lag the initial claims figures by one week.

The insured rate of unemployment was stable at 1.9%, off the peaks in August of 2.0% held for two consecutive weeks at month- end.

Will Monetary Policy Become More of a Science? from Federal Reserve Board Governor Frederic S. Mishkin can be found here.