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Economy in Brief

U.S. Weekly Initial Unemployment Insurance Claims Drop Sharply To Lowest Since 2008
by  Tom Moeller  July 15, 2010

Perhaps the job market is improving. Initial claims for jobless insurance fell last week to 429,000 following a decline during the prior week to 458,000. It was revised up from 454,000 claims. The latest figure was the lowest since August 2008 and was well below Consensus expectations for 450,000 claims. The four-week moving average of initial claims also fell to 455,250. These figures are down from the recession peak of 651,000 reached in March of 2009.

Working the other way, continuing claims for unemployment insurance during the latest week increased to 4.681M which was the highest level since late-May, but still it was off by one-third from the June '09 peak. The overall decline is a function of the improved job market but also reflects the exhaustion of 26 weeks of unemployment benefits. The four-week average of continuing claims rose slightly off the cycle low to 4.581M. This series dates back to 1966. 

Ongoing claims do not reflect those who receive extended benefits. Extended benefits for unemployment insurance fell during the latest week to 409,442. These figures do not include the decreased 3,911,389 benefit recipients (+50.6% y/y) under state administered "EUC" emergency programs, but paid for by the Federal government.

The insured unemployment rate increased to 3.7% from an upwardly revised 3.5% during the prior week. It reached a high of 4.9% during May of 2009. 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 June 26 were in Puerto Rico (6.3%), Oregon (5.0), Alaska (4.8), Pennsylvania (4.7), Nevada (4.4), California (4.3), Connecticut (4.2), Wisconsin (4.1), Rhode Island (4.0), Mississippi (3.9), New Jersey (3.9), and South Carolina (3.9). The lowest insured unemployment rates were in Virginia (1.8), Wyoming (2.0), Texas (2.3), Tennessee (2.6), Maine (2.7), Georgia (2.8), Maryland (2.9), Florida (3.2), New York (3.2), Ohio (3.2) and Massachusetts (3.5). These data are not seasonally adjusted but the overall insured unemployment rate is.

The unemployment insurance claims data is available in Haver's WEEKLY database and the state data is in the REGIONW database.

Unemployment Insurance (000s) 07/10/10 07/03/10 06/26/10 Y/Y 2009 2008 2007
Initial Claims 429 458 475 -20.3% 572 419 321
Continuing Claims -- 4,681 4,434 -24.7 5,809 3,340 2,549
Insured Unemployment Rate (%) -- 3.7 3.5 4.6 (7/2009) 4.4 2.5 1.9
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