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Economy in Brief

U.S. Initial Claims For Unemployment Insurance Slip
by Tom Moeller  March 24, 2011

Initial claims for jobless insurance inched lower to 382,000 last week from 387,000, initially reported as 385,000. The decline matched Consensus expectations according to Action Economics. Claims remained near the lowest since May 2008. The four-week moving average of claims fell to a new low of 386,250. During the last ten years there has been a 77% correlation between the level of claims and the m/m change in nonfarm payrolls.

Continuing claims for unemployment insurance were roughly stable w/w at the recovery low of 3.721M. The insured unemployment rate remained at 3.0% for the fourth consecutive week. These claimants, however, were only about half of the total number of people currently receiving unemployment insurance. Regular extended benefits, with eligibility dependent on conditions in individual states, fell sharply to 7.170M during the week ending March 5 (the latest figure available). A companion program, Emergency Unemployment Compensation, referred to as EUC 2008, saw a reduced 3.628M beneficiaries (-35.5% y/y) in the March 5th week.

A grand total of all claimants for unemployment insurance includes extended and emergency programs and specialized programs covering recently discharged veterans, federal employees and those in state-run "work share" programs. All together, during the March 5th week, the total number of these recipients fell to 8.766M, off 22.5% y/y. We calculate a broader insured unemployment rate by taking this grand total as a percent of covered employment. The latest rate was 5.7%. It peaked at 9.3% on January 2, 2010.

Two other programs, disaster unemployment assistance (DUA) and trade readjustment allowance (TRA), are reported through a different Labor Department channel. Claimants were the lowest since June in late December. All of these individual program data are not seasonally adjusted.

Data on weekly unemployment insurance programs are contained in Haver's WEEKLY database, including the seasonal factor series, and they are summarized monthly in USECON. Data for individual states, including the unemployment rates that determine individual state eligibility for the extended benefits programs and specific "tiers" of the emergency program, are in REGIONW, a database of weekly data for states and various regional divisions. Action Economics estimates are in AS1REPNA.

Community Banking in a Period of Recovery and Change is yesterday's speech by Fed Chairman Ben S. Bernanke and it can be found here.

Unemployment Insurance (000s) 3/19/11 3/12/11 3/5/11 Y/Y % 2010 2009 2008
Initial Claims 382 387 401 -14.2 457 572 419
Continuing Claims -- 3,721 3,723 -20.3 4,545 5,809 3,340
Insured Unemployment Rate(%) -- 3.0 3.0 3.6
3.6 4.4 2.5
Total "All Programs" (NSA)* -- -- 8.766 -22.5 9.850M 9.163M 3.903M

*Excludes disaster unemployment assistance and trade readjustment allowance
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