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Economy in Brief

U.S. Initial Claims for Jobless Insurance Slipped But Remained High
by Tom Moeller September 11, 2008

Initial claims for unemployment insurance slipped last week to 445,000 but the prior week's level was revised higher to 451,000.

The four-week moving average held roughly stable at 440,000 (35.4% y/y) and remained near the highest level since near the end of the 2001 recession. During July claims averaged 393,000.

A claims level below 400,000 typically has been associated with positive 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. Over the longer period of time, the level of claims for jobless insurance has not trended higher with the size of the labor force due to a higher proportion of self-employed workers who are not eligible for benefits.

Continuing claims for unemployment insurance during the latest week rose 122,000 to a new cycle-high. Continuing claims provide some indication of workers' ability to find employment and they lag the initial claims figures by one week.

The insured rate of unemployment ticked higher to 2.6%, the highest level since late-2003.

Unemployment Insurance (000s)  09/05/08 08/30/08 Y/Y 2007 2006  2005
Initial Claims  445 451 38.2% 322 313 331
Continuing Claims -- 3,525 35.7% 2,552 2,459 2,662
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