After unexpectedly dropping in the prior week - allegedly due to Juneteenth adjustments - initial jobless claims were expected to rebound higher last week (despite the unexpected surge in ADP employment data) and they did. 248,000 Americans filed for first-time unemployment claims last week (up from 236k, revised lower - the prior week). On a NSA basis, claims erased all of the 'improvement' of the prior week...

Source: Bloomberg

However, continuing claims continue to drift lower (at 1.72mm from 1.733mm last week)...

Source: Bloomberg

That is the lowest continuing claims print since Feb 2023.

The apparent decoupling of initial vs continuing claims could be more of a rotation (as we noted in the ADP report) from high- to low-paying jobs.