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Thursday, April 29, 2010

Initial Claims

Not too bad. This week's headline number is 448,000; the four week MA is 462,500.

The worry here is about money circulation; job production is slim and more state and local jobs will be cut this year. With new job creation constrained, we would like to see job losses slowing.

Anyway, I updated the three recessions claims graph:

Click on this one to open it up in another window or tab if you want a larger version.

The green line is 1980, which obviously transitioned into the second dip.

The situation is equivocal. It seems to be a race against time to generate enough economic activity to carry us through into longer term growth.

People are now falling off the employment extensions at a pretty fast clip, and that's not going to help. Census hiring should peak this summer and then start to fall off pretty rapidly. Census hiring is picking up some slack here.

Another potentially helpful factor is that more people who are working may be getting raises this year, which would certainly improve their ability and willingness to spend!

An afterthought:
BLS publishes a monthly labor review that is often helpful, which can be found here. Of course the information is usually 3-4 months out of date. Anyway, from this article in their latest edition:


This only goes through December.

Comments:
M.O.M.,

People are now falling off the employment extensions at a pretty fast clip, and that's not going to help.

I think you are right, but I can't find any hard data on how many people have actually maxed out their un-enjoyment benefits. Do you have anything in your data hoard?

Time (99 weeks) flys. It seems like only yesterday.
 
Angry Saver - the question of how many jobless workers are without unemployment benefits is really difficult.

First, not all unemployed are eligible for ANY benefits. They might not have been employed (in school, etc), or they might have been employed as contractors or casual laborers.

Then not every state has high enough unemployment levels to qualify for all the tiers of EUC (four now).

All I can tell you from looking at the most recent weeks of initial claims reports is that about 700,000 workers have dropped off, but some of those could have found work, and some could have exhausted the last tier for which they qualified.

On March 13th, about 5,900,000 workers were receiving EUC benefits. As of this week, only 5,200,000 were. The EUC extension expired April 4th or 5th, and then was extended until June about a week ago. I think the EUC rolls will pop up a bit in next week's report.

This article does a pretty good job of summing up the current situation.

Many recent graduates are in a very difficult position.
 
they might have been employed as contractors

This is a fast-growing trend, too. Which tends to make the U3 unemployment number increasingly meaningless.
 
I feel for the folks who are just graduating college with huge loans to pay off. I'm a little surprised we haven't heard any talk in Washington about forgiving those loans. That was a core constituency for the Democrats in 2008, you'd think the Dems would want to take good care of them.
 
Neil, I can see giving a hardship deferral on payment and interest, but not forgiving, the educational loans. I don't want to hand out any MORE huge freebies.

When they find decent work, we can restart the interest charges and they can darn well pay the loans back.
 
WSJ:

Quite so. I'm not in favor of wholesale forgiveness, and I'm not even sure the whole student loan program is more of a benefit than a hindrance. I am surprised that the Democrats aren't taking care of what they claim is a core constituency.

I also think a deferral during unemployment might be wise under current conditions.
 
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