Initial claims for state unemployment benefits
dropped 33,000 to a seasonally adjusted 521,000 in the week ended Oct.3, the lowest level since early January, the Labor Department said.This is the lowest weekly number, and the lowest four week average for new jobless since mid-January of this year.
Analysts polled by Reuters had forecast new claims slipping to 540,000 last week from a previously reported 551,000. A Labor Department official said seasonal factors expected a decline in new claims at the end of a quarter and a rise at the start of a new quarter.
The four-week moving average for new claims fell 9,000 to 539,750 last week, declining for a fifth straight week. The four-week moving average is considered a better gauge of underlying trends as it irons out week-to-week volatility.
It is also a huge relief after last Friday's jobs report.
Since the monthly jobs report is allegedly based on a survey conducted on the 12th of each month, I intend to post a further hyposthesis about the relationship between these two figures next week.
Please note, the four week average is now more than 16% lower than the peak. This is the threshold at which, if sustained for a long enough period of time, I believe that jobs may actually be added to the economy.
Update from Bonddad:
Here is the chart of claims and the 4-week moving average
This chart is a big relief for me as well. It indicates that the initial unemployment claims continue to move in the direction of recovery.
6 comments:
I would have actually expected us to be printing close to zero if not a small positive number by now with claims falling off and GDP probably printing 3%+ for Q3. I am really starting to think that our problem now (and going forward) is that businesses are either unwilling to hire or more likely they have no need to hire due to a combination of slow demand and increased efficiency in the workplace, thus limiting even the longer term needs for new employees. Couple that with what you showed yesterday to be a 60 year lack in the hiring of manufacturing employees and we could be facing an interesting new economic paradigm.
If you're correct in your earlier predictions, I hope we see it drop below 500K, so we can see job growth before the end of the year.
Let's hope you're right.
What I want to know is about the long term unemployed. Is the drop in that number due to folks finding jobs, or is it due to people running out of their unemployment insurance?
I know a 55 y/o manager who lost his job, and hasn't even been on an interview yet in two months. Guy has a degree and excellent work history.
JWC
JWC at 3:57:
These are initial jobless claims. This is the number of people who were just laid off and filed for first time unemployment benefits last week.
So the drop has nothing to do with exhaustion of jobless benefits.
The recovery is underway when you have a net gain in employment.
Right now we are still in a contraction as measured by employment.
Post a Comment