New unemployment claims are coming down

| 12 November 2009 10:01

The latest number on unemployment claims shows a seasonally-adjusted 502,000 people applied for unemployment insurance last week, bringing the more meaningful 4-week average down to 519,750, the lowest since late November 2008. That is a good thing because it shows the labor market is improving.

Nevertheless, 500,000 initial claims in an environment of reduced hiring is still consistent with the loss of 200,000 jobs monthly.  We really need to see this number hit 450-475,000 before non-farm payrolls increase.

 

Advance

 

 

 

Prior1

WEEK ENDING

Nov. 7

Oct. 31

Change

Oct. 24

Year

Initial Claims (SA)

502,000

514,000

-12,000

532,000

509,000

Initial Claims (NSA)

529,446

482,542

+46,904

494,394

539,787

4-Wk Moving Average (SA)

519,750

524,250

-4,500

526,750

490,250

 

Advance

 

 

 

Prior1

WEEK ENDING

Oct. 31

Oct. 24

Change

Oct. 17

Year

Ins. Unemployment (SA)

5,631,000

5,770,000

-139,000

5,817,000

3,933,000

Ins. Unemployment (NSA)

4,944,307

4,933,444

+10,863

4,984,950

3,460,633

4-Wk Moving Average (SA)

5,790,750

5,891,500

-100,750

5,965,750

3,830,750

Of course, seasonal adjustments are a big factor here going into the holiday season.  Actual claims were 529,446, which is up nearly 50,000 from the prior week. The pre-New Year’s seasonal adjustment peak comes in early December (140% adjustment down) followed by another peak in early January (up to 180% downward adjustment).  If we see smaller spikes in these weeks (last January hit a peak of 956,791 actual claims), then this could be a harbinger of better to come in Q1.

Source

Unemployment Insurance Weekly Claims Report – U.S. Department of Labor

avatar About Edward Harrison

Edward Harrison is the founder of Credit Writedowns and a former career diplomat, investment banker and technology executive with over twenty years of business experience. He is also a regular economic and financial commentator on BBC World News, CNBC Television, Business News Network, CBC, Fox Television and RT Television. He speaks six languages, a skill he uses to provide a more global perspective. Edward holds an MBA in Finance from Columbia University and a BA in Economics from Dartmouth College.

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