Recent Updates

  • US: Consumer Credit, Wholesale Trade (Jun), Employment Situation (Jul)
  • Global Sector PMI (Jul)
  • International Surveys: WMA Investor Outlook Survey (Jul)
  • Mauritius: CPI (Jul)
  • more updates...

Economy in Brief

U.S. Initial Claims for Unemployment Insurance Fall Further
by Tom Moeller May 7, 2009

Another sign that the U.S. job market is firming was provided by the decline in initial claims for unemployment insurance. They fell 34,000 last week to 601,000 which was their lowest level since late-January. Claims have fallen 11.0% from the March high. Still, despite the improvement, claims remain near the ten-year high. The four-week average of claims fell to 623,500, the lowest level since mid-February.

As was the case last week, if the pace of worker layoffs has slowed rehiring of unemployed workers has not picked up. Continuing claims for unemployment insurance increased to a record high of 6,351,000 and they remain twice the year ago level. The series dates back to 1966. The four-week average of continuing claims also rose to another record of 6,207,250. Continuing claims provide some indication of workers' ability to find employment and they lag the initial claims figures by one week.

The Labor Department indicated that the largest increases in initial claims for the week ending April 25 were in Michigan (+9,998), Massachusetts (+4,277), Kentucky (+3,681), North Carolina (+2,549), and New York (+2,219), while the largest decreases were in California (-10,833), Georgia (-4,174), South Carolina (-3,676), Wisconsin (-3,341), and New Jersey (-2,810).

Despite the improvement in the job market, the insured rate of unemployment which follows the continuing claims figures rose yet again to 4.8%. That level was double last April and the highest level since 1983. During the last ten years there has been a 93% correlation between the level of the insured unemployment rate and the overall rate of unemployment published by the Bureau of Labor Statistics.Clearly, the latest weekly figure understates labor market distress in some states. The highest insured unemployment rates in the week ending April 18 were in Oregon (7.6 percent), Michigan (7.2), Wisconsin (6.6), Pennsylvania (6.5), Idaho (6.4), Nevada (6.4), Rhode Island (6.1), New Jersey (5.8), Vermont (5.8), and Alaska (5.7).

The unemployment insurance claim data is available in Haver's WEEKLY database.

Unemployment Insurance (000s)  05/01/09 04/25/09 04/18/09 Y/Y 2008 2007 2006 
Initial Claims 601 635 645 61.6% 420 321 313
Continuing Claims -- 6,351 6,295 110.9% 3,342 2,552 2,459
large image