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Economy in Brief

Initial Jobless Insurance Claims Surge
by Tom Moeller May 18, 2006

Initial unemployment insurance claims surged 42,000 last week to 367,000 due to a partial government shutdown in Puerto Rico. The shutdown added 46,000 claims and has been resolved. Consensus expectations had been for 316,000 claims.

The Labor Department indicated that excluding claims related to the government shutdown in Puerto Rico seasonally adjusted initial claims would have been closer to 312,000.

The latest figure is for the survey period for May nonfarm payrolls and claims rose 63,000 (20.7%) from the April period. The payroll survey counts persons who were paid during the week which contains the 12th of the month as employed. During the last ten years there has been a (negative) 77% correlation between the level of initial claims and the m/m change in nonfarm payrolls.

Excluding strikers, claims rose 8,000 (2.6%) from the April survey period for nonfarm payrolls.

The four week moving average of initial claims rose to 333,250 (-0.1% y/y).

Continuing claims for unemployment insurance rose 8,000 following a revised 60,000 decline during the prior week.

The insured rate of unemployment remained at 1.8%.

Job Matching: Evidence from the Beveridge Curve from the Federal Reserve Bank of San Francisco is available here.

Unemployment Insurance (000s) 05/13/06 05/06/06 Y/Y 2005 2004 2003
Initial Claims 367 325 11.6% 332 343 403
Continuing Claims -- 2,389 -8.7% 2,663 2,923 3,530
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