Initial weekly unemployment claims decreased to 404,000 this week. Remember when on December 30th, Initial Jobless Claims dropped below 400,000 and everyone cheered? Then, the last week IUC jumped up to 445,000? Which pattern is true? Well, they both are. Initial unemployment claims have been bobbing up and down like a yo-yo for awhile. Get excited when the 4 month moving average drops below 375,000 and in the meantime, assume this economic report is simply the roller-coaster that it is. More details below.
From the jobless claims report:
In the week ending Jan. 15, the advance figure for seasonally adjusted initial claims was 404,000, a decrease of 37,000 from the previous week's revised figure of 441,000. The 4-week moving average was 411,750, a decrease of 4,000 from the previous week's revised average of 415,750.
That said, this is the release from the previous week, not revised:
In the week ending Jan. 8, the advance figure for seasonally adjusted initial claims was 445,000, an increase of 35,000 from the previous week's revised figure of 410,000. The 4-week moving average was 416,500, an increase of 5,500 from the previous week's revised average of 411,000.
Bear in mind initial unemployment claims are seasonally adjusted. Here are the raw totals:
The advance number of actual initial claims under state programs, unadjusted, totaled 550,594 in the week ending Jan. 15, a decrease of 212,504 from the previous week. There were 652,327 initial claims in the comparable week in 2010.
The 4 week average, now at 411,750, has incorporated in it the December outliner data point of a 410,000 weekly report, in addition to the above.
Below is the mathematical log of initial weekly unemployment claims, so one can get a better sense of the rise and fall of the numbers. A log helps remove some statistical noise, it's kind of an averaging. As we can see we have a step rise during the height of the recession, but then a leveling, not a similar decline. We have this yo-yo bobblehead, over 400,000 every week on initial claims, never ending labor malaise.
Below is a graph of the percent change in initial weekly unemployment claims for the last year. Look at how the numbers change bobs around zero, up and down, like a yo-yo.
Below is the 4 week moving average, set to a logarithmic scale to remove even more statistical noise, for the last year. Here a trend that is certain would appear. It looks like we have a start, but keep your fingers crossed, wait and see. Again, we need this metric to drop below 400,000 and keep dropping. Numerous economists say the number is 375,000 to show job growth. We see a strong decline, but then again, hasn't everyone in America been fired by now?
Below is a 2 year view of the 4 week moving average, set to a log scale.
The total number of people claiming benefits in all programs for the week ending Jan. 1 was 9,607,423, an increase of 401,237 from the previous week. This time a year ago 11,842,260 were claiming benefits. Where did those 2,234,837 people go? We know they did not all get jobs since the total number of jobs created for the past year has been 1,125,000 jobs.
Last week's unrevised overview is here.