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Economy in Brief

U.S. Initial Claims For Jobless Insurance Fall To Lowest Since 2008
by Tom Moeller April 1, 2010

Labor market improvement is continuing. Last week initial claims for jobless insurance figure fell 6,000 to 439,000 which was the lowest level since August 2008. The earlier week's level was revised up slightly and the latest is down from the recession peak of 651,000 reached in March of 2009. Last week's level roughly matched Consensus expectations for 440,000 new claims while the four-week moving average of initial claims fell to another cycle-low 447,250.

In addition, continuing claims for unemployment insurance during the latest week also fell to a cycle low and are down by one-third since late-June. The overall decline is a function of the improved job market but also reflects the exhaustion of 26 weeks of unemployment benefits. Continuing claims provide an indication of workers' ability to find employment. The four-week average of continuing claims fell to a cycle low of 4.680 mil. This series dates back to 1966.

Extended benefits for unemployment insurance dropped sharply to another cycle low of 136,990. They were down by two-thirds from a peak of 597,688 reached in November.Each state administers a separate unemployment insurance program within guidelines established by Federal law. Benefit amounts and the length of time benefits are received are determined by state law. For example, in Michigan and New York, an additional 73 weeks of benefits are available and in California, an additional 79 weeks are available.

The insured unemployment rate held steady at 3.6% during the prior week. The rate reached a high of 4.9% during May. During the last ten years, there has been a 96% correlation between the level of the insured unemployment rate and the overall rate of unemployment published by the Bureau of Labor Statistics.

The highest insured unemployment rates in the week ending March 12 were in Alaska (7.2% percent), Oregon (6.1), Pennsylvania (6.0), Wisconsin (5.9), Michigan (5.5), Nevada (5.5), North Carolina (5.1) and Connecticut (5.0). The lowest insured unemployment rates were in Virginia (2.0), Texas (2.3), Georgia (3.0), Florida (3.1), Wyoming (3.5), Maryland (3.6), Ohio (3.7), New York (4.0) and Maine (4.3). These data are not seasonally adjusted but the overall insured unemployment rate is.

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Unemployment Insurance (000s) 3/26/10 3/19/10 3/12/10 Y/Y 2009 2008 2007
Initial Claims 439 445 454 -32.6% 572 419 321
Continuing Claims -- 4,662 4,668 -19.3% 5,809 3,340 2,549
Insured Unemployment Rate (%) -- 3.6 3.6 4.3 (3/2009) 4.4 2.5 1.9
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