The DOL reported people filing for initial unemployment insurance benefits in the week ending on May 11th, 2013 was 360,000, a 32,000 increase from the previous week of 328,000 and a six week high. This is the wrong direction for weekly initial unemployment claims and shows, once again, as far as jobs are concerned, the recession never ended.
There is no event this week to explain the jump, but initial claims is a volatile labor metric. The statistic to pay attention to is the four week moving average on initial unemployment claims. The four week moving average increased 1,250 to 339,250, after last week's drop gave false hope the job market was improving. In the below graph we can the four week moving average is still at recession levels and seemingly staying there, now over five years. If anyone recalls, even before the Great Recession the job market was not so hot. The four week moving average, graphed below is set to a log scale, from April 1st, 2007.
Below is the mathematical log of initial weekly unemployment claims. A log helps remove some statistical noise, it's kind of an averaging and gives a better sense of a pattern. As we can see, we have a step rise during the height of the recession, but then a leveling, then a very slow decline, or fat tail. That fat tail has taken over five years to return to early recession levels, but initial claims are still not at pre-recession figures. Now initial claims are increasing again to boot.
As much as people wish it so, most government data is not complete and not real time. We have repeatedly warned, ad nauseum, do not bank on the initial claims number reported in the press release for that week. Initial claims for unemployment benefits is a weekly statistic and that implies a very short time window for data collection, it is always revised the next week, almost always upward. One can have unusual events which throw off the seasonal adjustment algorithm. One can have missed timing of events that can also throw a monkey wrench in one week's worth of data. As we pointed out in our weirdness in initial unemployment claims article, states might not report their quarterly adjustments for emergency unemployment benefits and we had the infamous fiscal cliff push past the final hour, which included extending those unemployment benefits for the long term unemployed.
Continuing unemployment claims for the previous week decreased, yet we still have large long term unemployed. The below continuing claims figure doesn't include those receiving extended and emergency unemployment benefits.
The advance seasonally adjusted insured unemployment rate was 2.3 percent for the week ending May 4, unchanged from the prior week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending May 4 was 3,009,000, a decrease of 4,000 from the preceding week's revised level of 3,013,000. The 4-week moving average was 3,015,250, a decrease of 21,000 from the preceding week's revised average of 3,036,250.
In the week ending April 27, not seasonally adjusted, the official number of people obtaining some sort of unemployment insurance benefit was 4,843,806 with 1,792,101 people receiving EUC, which was extended to January 2014 in the 11th fiscal cliff hour. There were 11.7 million official unemployed in April. .
It doesn't appear initial claims is very slowly returning to normal levels. The job market is still so poor, we see nothing on the horizon to show initial unemployment claisms will return to 2007 levels soon. The initial claims moving average increase is worst than it looks, simply because this has going on past half a decade with no end in sight. Seeing a rise again in the moving average implies American workers are being jerked around like a yo-yo on a string.