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Economy in Brief

U.S. Claims for Jobless Insurance Retreat
by Tom Moeller  July 7, 2011

In a sign of job market healing, initial claims for jobless insurance fell to 428,000 last week versus an upwardly revised 432,000 during the week prior, initially reported as 428,000. The latest compared to Consensus expectations for 420,000 claims. The four-week moving average of claims fell to 424,750. 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 fell to 3.681M, about where they've been since mid-April. The insured unemployment rate slipped to 2.9% from an upwardly revised 3.0%. 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 to 589,981 during the week ending June 18 (the latest figure available), the lowest level in nearly a year. A companion program, Emergency Unemployment Compensation, referred to as EUC 2008, saw 3.257M beneficiaries (-21.7% y/y) in the June 18th 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 June 18th week, these recipients slipped to 7.460M, down 17.5% y/y. We calculate a broader insured unemployment rate by taking this grand total as a percent of covered employment. The latest rate nudged up to 4.9%. 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 early-2009. 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.

News Shocks and Business Cycles from the Federal Reserve Bank of Richmond can be found here.

Unemployment Insurance(000s) 7/2/11 6/25/11 6/18/11 Y/Y % 2010 2009 2008
Initial Claims 418 432 429 -9.1 459 574 418
Continuing Claims -- 3,681 3,724 -17.6 4,544 5,807 3,338
Insured Unemployment Rate(%) -- 2.9 3.0 3.6
3.6 4.4 2.5
Total "All Programs" (NSA)* -- -- 7.460M -17.5 9.850M 9.163M 3.903M

*Excludes disaster unemployment assistance and trade readjustment allowance
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