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Economy in Brief

U.S. Initial Claims for Unemployment Insurance Ticked Up
by Tom Moeller May 15, 2008

Initial claims for unemployment insurance last week ticked up a modest 6,000 to 371,000 following the prior week's little revised 17,000 rise. Consensus expectations had been for claims to total 370,000 last week.

The four week moving average of initial claims fell very slightly week-to-week to 365,750 (19.5% y/y). Claims averaged 365,000 during April.

A claims level below 400,000 typically has been associated with growth in nonfarm payrolls. During the last ten years there has been a (negative) 76% correlation between the level of initial claims and the m/m change in nonfarm payroll employment.

Continuing claims for unemployment insurance rose 28,000 after a gain of 2,000 during the prior week. That was revised from the initial report of a moderate decline. The latest level was the highest since March 2004. It provides some indication of workers' ability to find employment.

The continuing claims numbers lag the initial claims figures by one week.

The insured rate of unemployment held steady at 2.3% for the third week. That was the highest since 2004.

Yesterday's speech by Fed Governor Randall S. Kroszner titled Risk Management and Basel II can be found here.

Unemployment Insurance (000s)  05/10/08 05/03/08 Y/Y 2007 2006  2005
Initial Claims  371 365 22.8% 322 313 331
Continuing Claims -- 3,060 22.9% 2,552 2,459 2,662
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