There were 340,000 continuing jobless claims shed in the latest report, which is the second decrease since the crisis began. And the drop would have been larger if not for big increases in California, Florida and Oregon.

 

According to the Wells Fargo Economics Group, "Overreliance on jobless claims led every forecaster to miss the increase in May nonfarm employment, but claims are still a useful indicator. Initial claims fell 19% from last week to 1.5 million, the largest percentage decrease since April 11."

But adding in the nearly 10 million people receiving Pandemic Unemployment Assistance (PAU) benefits, which are given to self-employed individuals, independent contractors, people with limited work histories, and others not normally eligible for state Unemployment Insurance (UI) benefits, there are more than 30 million Americans receiving unemployment checks.

"It's therefore hard to get too optimistic about the May nonfarm surprise," states the economics group. "For the first time we know of, the insured unemployment rate is higher than the U3 unemployment rate. Three reasons: (1) BLS admits they misclassified people, (2) labor force exits and (3) generous UI benefits causing a higher proportion to file claims."