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Economy in Brief

U.S. Weekly Continuing Claims For Jobless Insurance At Record High
by Tom Moeller January 29, 2009

The labor market remained under pressure last week as indicated by another rise in continuing claims for unemployment insurance. During the week of January 17 they rose 159,000 and that followed an upwardly revised 102,000 increase during the prior period. To emphasize the labor market's weakness, the latest increase raised continuing claims above their 1982 high to a new record for the series which dates back to 1966. The four-week average of continuing claims rose 66,500 to 4,630,000. Continuing claims provide some indication of workers' ability to find employment and they lag the initial claims figures by one week.

Though the latest level of continuing claims was a record, the labor force has grown as well. Therefore, the insured rate of unemployment was not at a new high. It did, however, rise to 3.6%, the highest since 1983. The highest insured unemployment rates in the week ending January 10 were in Michigan (7.3 percent), Oregon (6.7), Idaho (6.5), South Carolina (6.0), Pennsylvania (5.8), Wisconsin (5.7), Indiana (5.5), Nevada (5.3), Montana (5.2), Puerto Rico (5.2), and Rhode Island (5.2).

Initial claims for unemployment insurance also pointed to severe labor market weakness with a 3,000 rise to 588,000 during last week. The prior week's gain was revised down slightly but the latest level surpassed Consensus expectations for 575,000 claims. It was the highest since late during the sharp recession of 1981-82. During that recession, real GDP fell by 2.9% peak-to-trough.

The Labor Department indicated that the largest increases in initial claims for the week ending January 17 were in Florida (+6,500), California (+1,826), Puerto Rico (+1,308), Texas (+537), and Massachusetts (+86), while the largest decreases were in Michigan (-33,365), North Carolina (-25,516), Georgia (-12,635), New York (-12,432), and Pennsylvania (-10,077).

World Growth Grinds to Virtual Halt, IMF Urges Decisive Global Policy Response. The report from the International Monetary Fund can be found here.

Behavior of Libor in the Current Financial Crisis from the Federal Reserve Bank of San Francisco can be found here.

Unemployment Insurance (000s)  01/24/09 01/17/09 01/10/09 Y/Y 2008 2007 2006 
Initial Claims 588 585 527 60.7% 420 321 313
Continuing Claims -- 4,776 4,617 76.7% 3,342 2,552 2,459
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