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Economy in Brief

U.S. Initial Unemployment Claims Continue Sideways 
by Tom Moeller  June 9, 2011

For the third straight week claims held near the same level. Initial claims for jobless insurance ticked up to 427,000 last week from 426,000 during the week prior, revised from 422,000. The latest figure was higher than Consensus expectations for 419,000 claims. The four-week moving average of claims slipped to 424,000. 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 slipped again to 3.676M, about where they've been since mid-April. The insured unemployment rate ticked down to 2.9%, where it's been since late-February. 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 618,459 during the week ending May 21 (the latest figure available). A companion program, Emergency Unemployment Compensation, referred to as EUC 2008, also saw a 3.372M beneficiaries (-32.4% y/y) in the May 21st 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 May 21st week, these recipients fell to 7.601M, off 23.5% y/y. We calculate a broader insured unemployment rate by taking this grand total as a percent of covered employment. The latest rate slipped 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.

The Rise in Long-Term Unemployment: Potential Causes and Implications from the Federal Reserve Bank of Richmond can be found here.

Unemployment Insurance (000s) 6/4/11 5/28/11 5/21/11 Y/Y % 2010 2009 2008
Initial Claims 427 426 429 -8.0 459 574 418
Continuing Claims -- 3,676 3,747 -18.7 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)* -- -- 7.601M -23.5 9.850M 9.163M 3.903M

*Excludes disaster unemployment assistance and trade readjustment allowance
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