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

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Thursday, June 9, 2011

First Time Jobless Claims

It's Thursday!  And Thursday means unemployment!  Well, specifically, it means the Department of Labor's statistics on initial (and, to a lesser extent, continuing) unemployment claims.
Last week, the week ending 5/28, the news was sad and expectation-missing, but not outright terrible[1].  The advance figures for initial jobless claims came in at 422,000, with the unadjusted figure coming in at 377,421 new claims.  The total number of people claiming benefits in all programs (for the week ending 5/14) fell to 7,682,830.
So that was last week.  For the week ending 6/4, the Econoday-surveyed analysts are feeling marginally optimistic.  They're calling for first time claims to fall to only 418,000 new claims.  And so, with that prediction firmly in our minds, we turn to the Unemployment Insurance Weekly Claims Report for the week ending 6/4, and I'll pause for a second here to let you look it over yourself if you're playing the home game.
*whistles softly*
All right.  So, it's not good.  The "422,000" figure for the week ending 5/28 has been revised upwards to a level of 426,000.  Then, the advance figure for seasonally adjusted initial claims for the week ending 6/4 increased by 1000 from there, coming in at an expectations-missing 427,000 new claims.
Can you say ouch?
Interestingly enough, the unadjusted advance number of initial claims comes in at 364,507, a decrease of 12,914.  Yes, that's right, seasonal adjustment does some peculiar things.
The total number of people claiming benefits in all programs for the week ending May 21 fell to a level of 7,601,344, meaning that 453,343[2] people stopped claiming any form of unemployment benefits.  Unfortunately, we know from last week's Employment Situation report that May only added 54,000 nonfarm jobs, an average of 1742 jobs per day or 12,194 per week.  So, assuming that none of the new jobs for the week ending 5/21 went to brand new entrants into the labor force, that means that only 2.69% of the people who stopped claiming unemployment benefits did so because they returned to work.
[1]  "Outright terrible" was saved for the employment situation report.
[2]  5/1 had a level of 7,682,630 people claiming benefits in all programs.  The unadjusted number of initial claims for the week ending 5/21 was 371,857.  The Total number of claimants for the week ending 5/21 was 7,601,344.  7,682,630 + 371,857 - 7,601,344 = 453,143.

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