On a four-week moving average basis, weekly initial claims for unemployment in April 2000 were a few thousand lower than they were last week (top chart), but compared to the size of the workforce, they have never been lower than they were last week (second chart).
The only potentially disturbing thing about this is that recessions tend to follow lows in unemployment claims. Maybe, if things can't get much better, they are likely to get worse? I think that's a premature concern, if not an meaningless concern. Low levels of firings don't cause recessions. Low levels of firings usually happen when the economy is humming along and inflation is increasing. That—rising inflation and strong growth—is what prompts the Fed to tighten monetary policy, and tighter policy inevitably results in the economy sliding into a recession a year or so later. The current recovery stands in sharp contrast: it's the weakest on record, the Fed has never been more accommodative, and the Fed is probably years away from tightening policy by enough to strangle the economy.
Plus, one of the reasons this is a weak recovery is that the pace of hiring has been relatively tepid. If this were a normal economy we might have as many as 10 million additional jobs by now. Businesses have yet to become euphoric and over-build and over-hire. Businesses instead have been very cautious this time around, keeping their operations lean and mean and their bottom lines strong. This increases the odds that the current recovery still has years of life left. Recessions usually follow periods of over-confidence; confidence today is still relatively low, and caution is still prevalent.
With firings at very low levels, it's not surprising to see that the number of persons collecting unemployment insurance hasn't been as low as it is today for the past 14 years. In less than a year the number has dropped by more than half, from 4.65 million at the end of last year to only 2 million last week. From the all-time peak of 2010, almost 10 million people have dropped off the unemployment claims rolls in just five years.
Those are dramatic changes, especially in an era which transfer payments (unemployment insurance, welfare, food stamps, disability, medicare, social security, etc.) have risen to a new all-time nominal high ($2.5 trillion)) and a new all-time high relative to total federal spending (72%). Never have so few received government assistance for losing their job, and never have so many received so much for not working.
It's not just the weakest recovery, it's the craziest.