What the jobless claims report doesn't show
Today’s jobless claims report showed a decline to both initial claims and continued claims with a subtle flattening continuing to shape up for both series while total continued claims including federal extended benefits appear to be flattening.
Seasonally adjusted “initial” unemployment claims declined by 24,000 to 456,000 claims from last week’s revised 480,000 claims while “continued” claims declined by 40,000 resulting in an “insured” unemployment rate of 3.6%.
Since the middle of 2008 though, two federal government sponsored “extended” unemployment benefit programs (the “extended benefits” and “EUC 2008” from recent legislation) have been picking up claimants that have fallen off of the traditional unemployment benefits rolls.
Currently there are some 5.49 million people receiving federal “extended” unemployment benefits.
Taken together with the latest 4.98 million people that are currently counted as receiving traditional continued unemployment benefits, there are well over 10 million people on state and federal unemployment rolls.
The chart, above, shows the recent trend in initial non-seasonally adjusted initial jobless claims with the year-over-year percent change acting as a rough equivalent of a seasonally adjustment.
Historically, unemployment claims both “initial” and “continued” (ongoing claims) are a good leading indicator of the unemployment rate and inevitably the overall state of the economy.
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