There are some relevant caveats to the new Department of Labor report on initial unemployment claims, but at this point, the figures look remarkably good.
Applications for U.S. unemployment benefits fell by 5,000 to a seasonally adjusted 330,000 in the week ended Jan. 19, marking the lowest level since January 2008. Yet the claims report can somewhat erratic in January after the end of the holiday season and it will take another few weeks of data to see if the number of people filing new claims remains at its current lows. The Labor Department said estimates were used for three states that did not file complete information on time, including California and Virginia. Economists surveyed by MarketWatch expected claims to climb to 360,000 last week.
The caveats certainly matter -- seasonal quirks don't last -- but for the record, the last time we saw a number this low, it was almost exactly five years ago.
To reiterate the point I make every Thursday morning, it's worth remembering that week-to-week results can vary widely, and it's best not to read too much significance into any one report.
In terms of metrics, when jobless claims fall below the 400,000 threshold, it's considered evidence of an improving jobs landscape, and when the number drops below 370,000, it suggests jobs are being created rather quickly. We've been below the 370,000 threshold six of the last seven weeks.
Above you'll find the chart showing weekly, initial unemployment claims going back to the beginning of 2007. (Remember, unlike the monthly jobs chart, a lower number is good news.) For context, I've added an arrow to show the point at which President Obama's Recovery Act began spending money.
Leave a Comment:
Every month we see slow gradual progress in the economy. This is how recoveries happen after a depression.
But while the recovery seems to be taking a long time, what a lot of people don't realize is that as far as recoveries go post an economic depression, we're in record breaking territory as far as the speed at which we're recovering.
The Great Depression lasted from 1929-1939. A full 10 solid years of economic recovery. The Long Depression lasted from 1873 to 1896. We're talking a full 23 years of economic recovery. And that was marked by bank panic every few years. Imagine reliving the financial crisis every 4 years or so for nearly a quarter century!
At the rate we're going, we should be back to 5% unemployment rates by next year. 5% unemployment has been your basic full employment in the modern era. That means we will have a total recovery in about 6 years. No one seems to appreciate just how remarkable that is.
Imagine how much quicker the recovery would have been had republican governors not come in and eliminated hundreds of thousands of state and local jobs such as those for first responders and teachers.
No kidding. I think Obama's biggest mistake was not getting health care done quickly, doing it as a single payer system, and moving on to improving the unemployment situation.
Yes, of course. That's what he should have done. If only he hadn't been so shy about pulling that magic wand out of his desk and waving it in the air and making that happen we could have had single payer within a week of his inauguration.
Nobody can argue with the downward trend of initial jobless claims. It doesn't matter that the average wage has decreased. What matters is getting to a point of "full" employment. When that happens, wages will start to increase.
I can argue with the downward trend of jobless claims. Actual claims number 436,766. the books are being cooked and you all are falling for it. Don't be gullible.
Alva you seem like a good soul. I think you're misguided about the recovery this chart shows how slow this "recovery" really is in modern times. http://polination.files.wordpress.com/2012/02/1948-2012-comparative-recession-recovery-timelines.jpg
But wait,,,, the unemployment rate is still over 7%...........
So time to tax everyone to death, all so Obummer can spend money like its water.
oh ho-lee, apparently you haven't been paying attention to past blog postings...you know, the ones that show Obama actually reduced government spending and is documented as having one of the lowest spending records in recent history. Nice of you to check out the Libs' blogs but you really need to get your head out of Faux News more often. And, as pointed out above, had the GOP (Grand Obstructionist Party) actually played well with others, the unemployment rate would already be close to 5%. Give blame where blame is due.
Right. Because presidents can raise taxes and spend money by executive fiat.
Jeebus, am I the last person in America who had to take civics in high school?
Get a clue, Obummer has spent more money than any president in history!!
Dude has blown through over $1 trillion dollars every year he has been in office.
2008 the debt was $10 trilion, today it's over $16 trillion.
So how on earth can anyone say Otax-n-spend has cut government spending???
Go learn some simple math skills.
and you should check into a reading class. If you are representative of the GOP base and their grasp on modern politics and economic theory it's no small wonder they are losing so badly.
Consider what you are doing to the credibility of your entire philosophy. Your posts scream that you are willfully illiterate and the stupid schoolyard level name calling makes you look like an idiot who considers the fourth grade his "Senior Year"
Stupid is NOT cool or in your case even amusing
How many times can you use the word "stupid?"
Now go read the debt numbres and see for yourself.
Obummer has spent over $1 trillion dollars every year he has been in office...
@ho-lee-cow: It is true that the US economy has increased its debt by more than $6trillion. However, wasting time pointing fingers as to the cause...is just that...wasting time. I may not agree with how the stimulus money was spent, but I do think that it has positively contributed to the turnaround in the economy.
Yes, spending needs to be addressed. But, a floor had to be established in the employment market. With the consistent trend of lower initial claims, we may have found some firm footing. Since consumers make up 70% of the spending in the US economy, it is important that some confidence is put in place before addressing the out of control debt. Granted, it shouldn't be ignored either.
oh ho-lee, apparently you haven't been paying attention to past blog postings...you know, the ones that show Obama actually reduced government spending and is documented as having one of the lowest spending records in recent history
Wake up already! Obummer has spent over $1 trillion dollars every year he has been in office!!!
He has put over $6 trillion on the debt....
Sure you leftwingnuts all think he has cut spending, when in fact he has not!
Keep drinking that Obama Kool-Aid
This is good to see.
I read an article yesterday about a wheel maker in Alabama. The owner seemed pretty proud of himself in that he has'nt hired any new employees for three years due to automation (robots) and indicated more buisness' are automating. He went on to say job losses during the recession will not return because buisness has learned to do more with less and more jobs are being lost to China. My question is how many products does a robot buy. I believe we are on track to become a second class nation, and are allowing China to become the dominant force in the world. That means trouble not only for this nation but all nations.
So I guess the repub mantra is still austerity, austerity, austerity. Headlines today out of Spain show how well their austerity plans are working....they just hit 26% unemployment, and with further rounds of austerity coming, the forecast is for things to get even worse. If Ryan gets his way, we can join Spain and break unemployment records.
Now,let's throw in charts of the number of Americans that have dropped out of the economy, and then those that are part time being counted in those numbers...BS someone else,Ray.....
Sorry that simple facts are so abhorrent to you. Do you honestly believe that the actual US unemployment rate is anywhere near Spain's?? Do you honestly believe the historical record here in the US and the rest of the world is completely wrong in terms of what austerity measures do to an economy in general and employment in particular? OK, dude, let's do the austerity shuffle like you must apparently support. Let's start by letting the cuts to the Pentagon in the sequester go through. What, that would cost lots of jobs? I thought the government can't create jobs. Isn't that a central credo in the repub fantasy land?
I keep hoping for even a glimmer of neuronal activity from the collective mind of the right, but if the repub party was a person, the plug would have been pulled on them long ago for a flatline EEG. They are truly the Terry Schiavo of the political world.
I find it interesting that unemployment started to kick up in late 2007, well before the financial crisis of September 2008. I would be interested to see a similar timeline of housing starts.
It would also be interesting to see timelines of public and private sector unemployment.