Initital Claims for Unemployment Fell Last Week. Why Should We Care?

[ProSense]

Initital Claims for Unemployment Fell Last Week. Why Should We Care?

Initial claims for unemployment insurance fell last week:

In the week ending Dec. 11, the advance figure for seasonally adjusted initial claims was 420,000, a decrease of 3,000 from the previous week’s revised figure of 423,000. The 4-week moving average was 422,750, a decrease of 5,250 from the previous week’s revised average of 428,000.

This continues the recent downward trend (the blue line is initial claims, and the red line is the four week moving average):



Why should we care about initial claims? Many analysts use a figure of 400,000 as the breakeven point for job creation. When claims fall below this value, and they are getting close to doing so, employment begins expanding rather than contracting.

The 400,000 figure is a very rough estimate of the turning point, but the relationship between initial claims and actual employment is evident in this graph from the Cleveland Fed (the dashed line marks the 400,000 initial claims figure, note also that the graph has the axes reversed, the left-hand scale is employment growth and the right-hand scale is initial claims):

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[bushisanidiot]

1. This will be spun as bad news by the Obama haters

and the left who hate him.

excuse after excuse will be given.. as if no one "fell off the roles" or "just gave up" last year, or the year before, or the year before. No, no. That has only happened since President Obama entered the white house.

[mcar]

2. We don't care about anything that is positive

We're DU - if it doesn't reflect negatively on the President, it's not worth mentioning. :sarcasm:

[rfranklin]

3. A little early to cheer, the claims are still higher than most of Bush's tenure...

and he had zero net job creation. Where are the jobs going to come from? During the job creation in Clinton's presidency we had the dot.com boom and we had somewhat of a semiconductor industry. That's gone.

[Aramchek]

4. Obama cuts Unemployment claims!! Damn him straight to Hell!!!!!

:sarcasm:

[girl gone mad]

5. It's the new math..

The number of initial claims in the week ending Dec. 11 fell 3,000 to 420,000. The consensus forecast of Wall Street economists was for claims to inch higher. The four-week average fell 5,250 to 422,750.

Claims in the previous week were revised to a decrease of 15,000 to 423,000 compared with the initial estimate of a decline of 17,000 to 421,000.

And let's just ignore the 99ers while we're at it. Recovery delirium is fun.

[ProSense]

6. There is nothing new about the math

just the desire to write it off.

[girl gone mad]

7. Speaking of writing things off..

"Covered" employed, as determined by the DOL, has dropped by over 8 million people during this downturn. 6 million of those losses occurred this year alone.

Yet we are supposed to be excited by a 1000/420,000 drop in weekly claims.

[ProSense]

8. "Yet we are supposed to be excited by a 1000/420,000 drop in weekly claims."

Who said you have to be excited? That still doesn't change the fact that the math isn't new.

"'Covered' employed, as determined by the DOL, has dropped by over 8 million people during this downturn. 6 million of those losses occurred this year alone."

Wait, 6 million of the 8 million jobs lost during the recession were lost this year? Are you saying only 2 million of those jobs were lost between 2007 and 2010?

[Kber]

9. I feel for the 99ers

really, I know some and my stomach is in knots over their situations.

However, that has nothing to do with New Claims. It's apples and oranges.

If you are looking for a summary of what the various reports mean (and there are many different ones that measure different things with different methodology), I've tried to sum it up here. FWIW

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=433x568914

[ProSense]

10. Thanks n/t