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Thursday, May 30, 2013

Weekly Initial Claims Increase (May 30th report)

Weekly unemployment initial claims increased by 10,000 this week to 354,000.  This is the second increase in the past three weeks; however, the number of claims has been inconsistent but generally lower over the past two months.

First time unemployment jobless claims increased to 354,000  for the week ending May 25th.  Since the beginning of the year, new weekly claims have remained in the 325,000 to 365,000 range for eighteen out of the past twenty-one weeks.  

The four-week moving average # of claims increased by 
6,750 last week after increasing by 500 the week before.  It is now 347,250.  Initial claims continue now at about the same level that they were five years ago, in late 2007 to early 2008.  

(Even though the weekly initial claims numbers are seasonally adjusted, these numbers are always a bit volatile and should  only be analyzed in terms of a trend over a period of weeks.  See the graph below.) 

For the week ending May 11th, 4,578,592 people were receiving unemployment benefits under one of the programs that are available (regular state, federal extended unemployment compensation, or a few other smaller programs).  This was a decrease of about 167,000  total claims since the previous week.  The decrease was proportionally divided between a decrease of about 114,000 claims in the number of continuing claims in the Regular State program (the first 20 to 26 weeks of unemployment benefits) and a decrease of about 50,000 continuing claims in the Federal Extended Unemployment Benefits program (the "Tiers").

1,559,654 FEWER 
people are receiving unemployment benefits now vs. one year ago.  We do not know what has happened to the people who are no longer receiving benefits; we do not know how many of those 1,559,654 people found employment, how many retired, etc.  We do know that there are 1,729,000 MORE people reporting themselves as employed than a year ago and there are  2,094,000 MORE non-farm jobs.  We also know that a grand total of 51,838,000 hires have been made by employers between April 2012 and March 2013, the latest month for which numbers are available.  (Some people may have been hired more than once during the year, so the number of "hires" is generally higher than the number of people who have been hired.)   


The percent of unemployed people receiving benefits increased to about 41.6% for the week ending May 11th.

If you are receiving benefits, you may be interested in these two reports:  

The chart above is one of the BEST charts for understanding and observing changes in the weekly initial claims numbers over time.  This year (red:  2013) and the past three years (blue:  2010green:  2011 and black:  2012) are marked in different colors.  You can see that, as a trend, first time claims for unemployment have declined from one year to the next, even though there are variations within the year.  Though the number of initial unemployment claims has been variable over the past three months, it has continued a downward trajectory.  

Be aware that:
  1. The graph above shows first time claims, so people who have continued to receive benefits or who have lost unemployment benefits are not counted in these numbers.  
  2. They are seasonally adjusted, so most variations caused by weather or holidays are already included in these numbers.  
  3. As these are weekly numbers, they are more volatile than the monthly numbers.

In the week ending May 25, the advance figure for seasonally adjusted initial claims was 354,000, an increase of 10,000 from the previous week's revised figure of 344,000. The 4-week moving average was 347,250, an increase of 6,750 from the previous week's revised average of 340,500.

As usual, to put all of this into perspective, check out the red line on the chart above to see where jobless claims are now, in 2013, compared to the past three years.

First time unemployment claims increased by 14,000 over those reported last week.  Initial claims as announced last week were  340,000, so the claims from that week were revised upwards by 4,000 to 344,000.  There are usually slight upwards revisions  (1,000 to 3,000) in the numbers of initial claims in most weeks.  (The chart above shows REVISED claims numbers.)

Current February/March/April Initial Claims Continue to be the Lowest Since Late 2007/Early 2008.

As a whole, the current numbers of initial claims continue to be the lowest Winter-Spring initial claims numbers since late 2007/early 2008.

Continuing regular state claims, from people who are continuing to claim unemployment through the initial 20 to 26 week regular unemployment program, increased by 63,000 for the week ending May 18th after decreasing by 101,000  the week before.  2,986,000 people filed continuing regular state claims in the week ending May 18th.  As a whole, continuing regular claims continue to decline despite some individual weekly increases.  (There were 3,283,000 continuing claims a year ago.) 

Total number of people receiving unemployment insurance is 41.5% of the officially unemployed for the week ending May 11th.  

The weekly report also tells us the total number of people who are receiving unemployment benefits.  For the week ending May 11th, 4,578,592 people were receiving unemployment benefits under one of the programs that are available (regular state, extended benefits, federal extended unemployment compensation, or a few other smaller programs).  This compares with 11,014,000 people who are unemployed in unadjusted numbers according to the monthly April unemployment situation report which was released Friday, May 3rd.  Those numbers, showing that only 41.6% of the officially unemployed are receiving benefits, should make it clear that people do NOT need to be receiving unemployment insurance to be counted among the unemployed.  (This ratio and these two numbers are NOT seasonally adjusted.)

Extended Benefits (EB) No Longer Available in any State

Extended Benefits claims were only available in Alaska during the weeks ending April 27th and May 4th.  Extended Benefits were no longer available in Alaska (or any other state) starting the week ending May 11th.  

As of the week ending May 11th, only 65 people were still receiving Extended Benefits, as mentioned above.  A year ago, 312,000 people were receiving Extended Benefits.  As recently as April 2012, 412,411 people were receiving Extended Benefits.

Therefore, over the last year, 99.9% of the people who were receiving Extended Benefits are no longer receiving such benefits.  We do not know how many of these 312,000 people found jobs, how many have another source of income in the family, and how many have nothing. 

To reiterate, while a decrease in the number of people FILING for initial claims is a good thing and indicates that fewer people are being laid off, a decrease in the TOTAL number of people getting unemployment insurance may only show that fewer people are eligible for unemployment insurance benefits.

Any questions or confusion, please leave a comment or email me!

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