The Week in Review: September 2, 2025
Initial Claims and Economic Signals: What Investors Watch
Initial claims for unemployment insurance measure the number of people filing for unemployment benefits for the first time. The data is released weekly, making it one of the most up-to-date indicators of labor market conditions. It is a key economic indicator because it offers a real-time snapshot of the health of the labor market.
A sudden rise can signal that layoffs are increasing, which may point to economic weakness or a slowdown.
Conversely, a sudden and unexpected decline could be a sign of economic strength. Like any economic indicator, it has drawbacks. At times, it can be volatile over a very short period, sending a misleading economic signal.
All that said, what are weekly initial claims telling us today? Simply put, layoffs remain low.
Granted, this is simply half the equation. It doesn’t tell us about hiring, which has slowed. From a broader economic perspective, initial jobless claims indicate that despite several high-profile layoffs, the overall low level of claims suggests that the economy continues to expand. Note: Laid-off federal workers file under a different system.
There’s one other piece of data that’s generated in the weekly report from the Department of Labor—continuing claims.
After one files for the first time following a layoff, state unemployment offices require the unemployed worker to file on a regular basis in order to receive benefits. Most states allow laid-off workers to file up to six months before losing benefits. A few states have a shorter period.
Tracking the number of people who regularly file for unemployment benefits—continuing claims—gives us insights into how long it is taking laid-off workers to find new jobs.
As the graphic shows, while the number who are actively looking for work is at a low level, continuing claims have ticked off the bottom, as those who are unemployed are spending more time searching before landing a new opportunity.
Despite some cracks that are appearing in the labor market, the data suggest that layoffs haven’t surged, and the economy is expanding.
Market Summary
TWO FOR THE ROAD
“20 years from now you’d give anything to be this exact age, exactly this healthy, in this exact moment. Take a second to enjoy it.” — Richard Webster
Can you wear white after Labor Day? This old tradition goes back to the late Victorian era, where it was a fashion faux pas to wear any white clothing after the summer officially ended (plus, it should go without saying that it was a whole lot more practical in the days before air conditioning). The tradition isn’t really followed anymore, but wearing white was a sign that you were still in vacation mode at your summer cottage back in those days. - History, August 27, 2025
Please do not hesitate to contact me with any questions or concerns.
I hope you have a great week!
Warmest Regards,
Bill Stordahl, CFP®
Managing Director
Stordahl Capital Management
Sources: ConstitutionCenter.org, ConstitutionFacts.com, Military.com, CNN
Stordahl Capital Management, Inc is a Registered Investment Adviser. This commentary is solely for informational purposes and reflects the personal opinions, viewpoints, and analyses of Stordahl Capital Management, Inc. and should not be regarded as a description of advisory services or performance returns of any SCM Clients. The views reflected in the commentary are subject to change at any time without notice. Nothing in this piece constitutes investment advice, performance data or any recommendation that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. Advisory services are only offered to clients or prospective clients where Stordahl Capital Management and its representatives are properly licensed or exempt from licensure. No advice may be rendered by Stordahl Capital Management unless a client service agreement is in place. Stordahl Capital Management, Inc provides links for your convenience to websites produced by other providers or industry-related material. Accessing websites through links directs you away from our website. Stordahl Capital Management is not responsible for errors or omissions in the material on third-party websites and does not necessarily approve of or endorse the information provided. Users who gain access to third-party websites may be subject to the copyright and other restrictions on use imposed by those providers and assume responsibility and risk from the use of those websites. Please note that trading instructions through email, fax, or voicemail will not be taken. Your identity and timely retrieval of instructions cannot be guaranteed. Stordahl Capital Management, Inc. manages its clients’ accounts using a variety of investment techniques and strategies, which are not necessarily discussed in the commentary. Investments in securities involve the risk of loss. Past performance is no guarantee of future results.
1. The Dow Jones Industrials Average is an unmanaged index of 30 major companies which cannot be invested into directly. Past performance does not guarantee future results.
2. The NASDAQ Composite is an unmanaged index of companies which cannot be invested into directly. Past performance does not guarantee future results.
3. The S&P 500 Index is an unmanaged index of 500 larger companies which cannot be invested into directly. Past performance does not guarantee future results.
4. The Global Dow is an unmanaged index composed of stocks of 150 top companies. It cannot be invested into directly. Past performance does not guarantee future results.
5. CME Group front-month contract; Prices can and do vary; past performance does not guarantee future results.
6. CME Group continuous contract; Prices can and do vary; past performance does not guarantee future results.