Last week, the number of people filing new unemployment claims dipped to 601,000 on a seasonally-adjusted (SA) basis. The unadjusted number (NSA) was even lower at 534,047. This most recent data should bring cheer to the markets as it comes the heels of a better than anticipated unemployment report yesterday from ADP, the payroll processing company. Digging into the data, one sees that the 4-week average SA claims are now at 623,500, the lowest figure in since data for the week ending Feb 14.
Meanwhile, those seeking jobs are still finding it hard to find employment. SA continuing claims were well over 6.3 million and actual continuing claims were well over 6.2 million. The chart below shows the data in detail.
What you should notice from the chart, highlighted in red, is that the NSA data is declining both for initial claims and continuing claims. Moreover, initial claims comparisons to last year continue to improve; 4-wk average NSA initial claims numbers are running 232,000 over last year, down from a peak of 327,000 in January. Yet, incongruously, the Huffington Post chose to highlight the worst part of the numbers,the seasonally-adjusted continuing claims. In a post titled, “Total Number Receiving Jobless Benefits Set Record For 14th Straight Week,” they said the following”:
New applications for jobless benefits plunged to the lowest level in 14 weeks, a possible sign that the massive wave of layoffs has peaked. Still, the number of unemployed workers getting benefits climbed to a new record.
The Labor Department says the number newly laid off workers applying for benefits dropped to 601,000 last week. That was far better than the rise to 635,000 claims that economists expected.
But the total number of people receiving jobless benefits climbed to 6.35 million, setting a record for a 14th straight week.
In my view this reporting is either sloppy, biased or both. Nevertheless, I should point out that the idling of workers at bankrupt automakers could balloon these numbers. Some are concerned that idled plants may never re-open, leaving thousands out of work and re-inflating the jobless totals. Despite my contention that the worst is behind us, this possibility is a reminder that we are not out of the woods yet.
SourcesUnemployment Insurance Weekly Claims Report – U.S. Department of Labor
Originally published at Credit Writedowns and reproduced here with the author’s permission.