Okun Shrugs With Productivity Plunging, Labor Costs Surging, And Claims Improving

Tyler Durden's picture

Initial claims were expected to rise modestly to 355k from last week's noisy 344k print (which was revised up) but instead (seasonally-adjusted of course) they improved to 340k (from a revised 347k). However, non-seasonally-adjusted claims rose at their fastest rate of the year. Adding further confusing salt to the wound, as we noted here, it seems Okun's Law is broken, with productivity dropping at its fastest since Dec 2008, unit labor costs surging at their fastest since in 11 months - and all with GDP going nowhere and initial claims improving.

Non-Seasonally-adjusted claims surged the most in 2013...

 

as Productivity and labor costs diverged...

 

Charts: Bloomberg