"Economists are pessimists: they've predicted 8 of the last 3 depressions."
--Barry Asmus

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Thursday, April 28, 2011

First Time Jobless Claims

If it's Thursday, it must be time for the crushing despair of first time jobless claims.
Well, all right.  Crushing despair is overstating things to a significant degree.  But the figures really haven't been all that good for a few years now, which is one of the reasons that the Fed has unemployment on its short list of "things that could easily derail the national recovery from the recession".  Case in point:  For the week ending 4/16 we came in at 403,000 initial claims, which missed expectations by 13,000.  The unadjusted initial claims figures came in at 380,658 (a decline from the previous week of 62,835), which was better.  The state program insured unemployment level for the week ending 4/2 came in at 3,695,000.
One mildly bright spot was that the total number of people claiming UI benefits declined by 287,735 to 8,229,810.  This isn't as bright as it could be, though.  The last few months have seen an average of about 200,000 new nonfarm jobs added per month, which we can call roughly 50,000 new jobs per week.  That means that only about 18% of that decline can be attributed to people returning to work;  the other 82% is most likely people using up their benefits.
And now that I've totally ruined your morning, let's move on to today's data.  The Econoday-surveyed analysts are expecting a mild improvement in the rate of people applying for first time benefits, calling for 390,000 new claims for the week ending 4/23.  As always, we turn to the US Department of Labor to find out how the analysts did.
The Unemployment Insurance Weekly Claims Report for the week ending 4/23 is, well, it's full of crushing despair.  Right out the gate, the initial claims figure for the week ending 4/16 was revised upwards to 404,000.  Then, for the week ending 4/23, initial claims are reported at 429,000 (missing expectations by 39,000).  The unadjusted number of claims for the same period was 385,622, an increase of 4,964.  The advance number for seasonally adjusted insured unemployment comes in at 3,641,000 (a decrease of 54,000), and the total number of people claiming benefits in all programs comes in at 8,187,232 (a decline of 42,578[1]).
So, what's the takeaway?  The new claims figures were terrible, but there is some potentially good news in the total number of claimants.
[1]  Meaning that, working with the average numbers I threw about a few paragraphs back, it is possible that every single person in that decrease was able to find a job.  That's a nice thought, isn't it?

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